A business should not lay claim to any profit before it is earned. This is in accordance with the
Going concern concept
Prudence concept
Dual aspect concept
Consistency concept
Correct answer is B
Prudence also known as conservatism. This principles state that the accountant should not anticipate income and will normally take the figure that will understate rather than overstate the profit.
The purchase day book is used to record
Purchases returns
Cash purchase
Total purchases
Credit purchase
Correct answer is D
The purchase day book is the book of original entry for recording all of the goods purchased on credit from suppliers. It is sometimes called purchases journal.
Two or more individuals
Only one person
Two individuals only
Two or more companies
Correct answer is A
Section 1 of the Partnership act 1890 defined partnership " as a relationship which subsists between two to twenty people carrying on a business in common with a view of profit making and the sharing exercise being confined to only members in the partnership deed".
Drawings of ₦20,000 was made
The opening capital of ₦40,000 was invested
Beauty was paid a salary of ₦90,000
Cash shortage of ₦30,000 was recorded
Correct answer is C
The calculation for closing capital is as follows:
Closing Capital = Initial Capital + Profit + Salary - Drawings - Cash Shortage
Closing Capital = ₦40,000 + ₦50,000 + ₦40,000 - ₦20,000 - ₦30,000
Closing Capital = ₦140,000 - ₦20,000 - ₦30,000
Closing Capital = ₦140,000 - ₦50,000
Closing Capital = ₦90,000
Therefore, the closing capital for Beauty would be ₦90,000.
Hence, the correct answer is ₦90,000.
The accounts maintained in the nominal ledger are
Liabilities and capital
Assets and liabilites
Income and capital
Expenses and income
Correct answer is D
Nominal accounts are accounts in which income and expenditure are recorded. It relates to gains, losses, income, expenses e.g discount accounts, sales accounts etc.