Accounts - Principles of Accounts Past Questions and Answers

The total of the creditors at the beginning of the year was N4,600 and at the end of the year N5,250. During the year, N26,500 was paid to suppliers and N130 was received in discounts from these suppliers. The purchases for the year would be

A N26,630
B N27,038
C N27,150
D N27,280

Question 27:

Given:
Capital at the beginning...............N20 000
Drawings...............................N3 000
Capital................................N30 000
New capital introduced.................N8 000
What is the profit for the period?

A N4 000
B N5 000
C N6 000
D N8 000

Question 28:

Which of the following stock valuation methods is suitable under inflationary conditions?

A FIFO
B LIFO
C Simple average
D Weighted average

Question 29:

The understatement of closing value of work-in-process would have the effect of?

A Understating cost of goods manufactured
B Overstating prime cost of manufactured
C Overstating cost of goods manufactured
D Undersating prime cost of goods manufactured

Question 30:

Emeka Manufacturing Company (Extract) Manufacturing Account.
Direct material.....................N5 000
Direct labour.......................N4 500
Direct expenses.....................N3 000
Factory overhead....................N2 500
Selling distribution................N1 500
Calculating the production cost?

A N16 500
B N15 000
C N14 000
D N12 500