Accounts - Principles of Accounts Past Questions and Answers

Which of the following transaction is BEST recorded in the general journal?

A Payment of rent with cheque
B Purchase of stock with cash
C Purchase of an asset on credit terms
D Transfer of cash from head office branch

Question 42:

Diamond Ringo business was started when Mr. Diamond brought in a cheque of N500,000, which was paid into the bank account. Which of the following entries properly records the transaction?

A Cash account was credited with N500,000 and capital account was debited with N500,000
B Bank account was debited with N500,000 and capital account was credited with N500,000
C Bank account was accredited with N500,000
D Mr. diamond acount was debited with N500,000 and the cheque account was credited with N500,000

Question 43:

One major advantage of ledger is that it

A Is a book of original entry
B Is only accessible to share holders during liquidation
C Removes the need for preparing a balance sheet after each transaction
D Can be used by any type of business

Question 44:

A trail balance is usually prepared by an accountant from account balances in the ledger for the purpose of

A Classifying accounts in the ledger
B Testing arithmetical accuracies of the ledger account balances
C Identifying the balance sheet items
D Providing a basis for establishing the accountant's competence

Question 45:

What are the advantages of an imprest petty cash book?
I cheques can be drawn easily
II A cheque on the use of cash
III Liability of the petty cashier is limited to the value of petty cash
IV Loses through the petty cashier can be minimized

A I, II and III only
B I, II and IV only
C I, III and IV only
D II, III and IV only