ACC102 TMA Solutions

ACC102 List of Questions

Q1 The following transactions relating to debtors were extracted from the books of a company for the month of January 2014: Balance as at 1st January 2014 N725,000 Cash collected during the month N375,000 Bad Debts written off N25,000 Balance as at 31st January 2014 N650,000 Total credit sales during the month of January, 2014 were:
N325,000
N975,000
N475,000
N350,000

Q2 Valuing inventory at lower of cost or Net Realizable Value (NRV) is an application of the accounting concept of:
Going concern
Consistency
Matching
Prudence

Q3 Which one of the following is a qualitative characteristic of financial statements?
Going concern
Accrual basis
Relevance
All of the above

Q4 Unpaid expenses relating to an accounting period are treated as:
Pre-payments
Accrued expenses
Other expenses
Advances

Q5 Marina purchased goods on a credit basis from Jamoh for N100,000 and returned half of the goods to Jamoh subsequently. Which one of the following documents is issued by Jamoh to record the return of goods?
Invoice
Credit note
Debit note
Remittance advice

Q6 The IASBâ??s Framework identifies reliability as one of the four qualitative characteristics of financial information. Which one of the following is not an element of reliability?
Information should be timely
Information should be free from material error
Information should be free from bias
Information must be complete

Q7 The International Accounting Standards Boardâ??s (IASB) Framework for the Preparation and Presentation of Financial Statements (Framework) is the IASBâ??s conceptual framework. Which one of the following does the Framework not cover?
The format of financial statements
The objective of financial statements
Concepts of capital maintenance
The elements of financial statements

Q8 Where, in a companyâ??s financial statements complying with International accounting standards, should you find dividends paid? 1. Income statement 2. Balance sheet 3. Cash flow statement 4. Statement of changes in equity.
1 and 3
2 and 3
1 and 4
3 and 4

Q9 Which of the following statements about bank reconciliations are correct? 1. In preparing a bank reconciliation, unpresented cheques must be deducted from a balance of cash at bank shown 2.A cheque from a customer paid into the bank but dishonoured must be corrected by making a debit entry in the cash book. 3. An error by the bank must be corrected by an entry in the cash book. 4. An overdraft is a debit balance in the bank statement.
1 and 3
2 and 3
1 and 4
2 and 4

Q10 Which of the following statements are correct? 1. A companyâ??s authorised share capital must be included in its published balance sheet as part of shareholdersâ?? funds. 2.If a company makes a bonus issue of ordinary shares, the total shareholdersâ?? interest (share capital plus reserves) remains unchanged 3. A companyâ??s statement of changes in equity must include the proceeds of any share issue during the period. 4. A company must disclose its significant accounting policies by note to its financial statements.
1 and 2 only
1 and 3 only
3 and 4 only
2, 3 and 4

Q11 Consumer price index (CPI) or ���. Is on very important means determine the degree of change in price level (inflation)
retail price index
retail tax price
general consumer price assessment
wholesaler tax price

Q12 An accounting concept which separated the owner of the business and the business is known as:
entity concept
going concept
consistency concept
dual concept

Q13 �����.occurs when certain amount of money that used to buy certain quantity of goods previously, can now only purchase fewer quantity of the same goods
inflation
deflation
amortization
capitalization

Q14 all these are ,means of generating income of the building societies except
interest on mortgage
returns on investment
rent received
motor vehicle instruction

Q15 the primary aim of establishing a liability society is ��
to receive fund form its member in area
to received fund from its member and advance part of the fund to member of the society
to charge fund to member
to promote internal fund allocation

Q16 �����.. are formed registration with the chief register of friend societies
building deposit
building societies
cooperative societies
B & C

Q17 shareholders funds compose of all except
share capital
retained profit
bill discounted
general revenue

Q18 Example of federal government bill purchase on the open market
treasury bill
treasure exchanged
bill transfer
deposit

Q19 all the following are charge to appropriation account excepts
dividend
retained profit
taxation
general revenue

Q20 All the following are income except
foreign exchange earnings
depreciation
commission
transfer charges

Q21 �����.. are business entitle whose main area of operation are to accept cash deposit from the public and other perform other prominent function
cashier
hirer
vendor
banks

Q22 Normal gross profit percentage is calculate as ��.
normal profit + insured charges/ turnover
normal profit/turnover
normal profit/turnover
normal profit/insured charges

Q23 which of the following is not necessary for the purpose of compiling average clause
amount insured
turnover
retrocession
gross profit

Q24 which of these is not a terminology used in insurance claims accounting
arbitrage
cost of working
standard turnover
consequential loss

Q25 ������. Is a period of dislocation for which the insurance was effected and is normally fixed in the policy
free period
change period
period of indemnity
A & B

Q26 which of the two main classes of lease is a non cancellable lease?
finance lease
capital lease
unfinanced lease
A&C

Q27 which of the following is a finance lease arrangement
leveraged lease
sales â?? type lease
capital lease
opening lease

Q28 periodic payments made by the lesser to the lessor are called
rent
interest
cash price
lease payment

Q29 straight line is calculated as followsâ?¦
finance charge
distribution cost
finance charge /duration of lease
installment price / depreciation

Q30 all these are treatment of finance charges except
actuarial method
straight line method
reducing balance method
sum of the year digit

Q31 ������. Is a contractual agreement between an owner, the lessor and another party the lessee which express the right to use the leased asset for an agreed period of time in return for a consideration
lessor
hire purchase
a lease
vendor

Q32 According to SAS II, treatment and disclosure of lease transaction in the book of both
vendor and hirer
leasor and lessee
hire purchase and sales
C & A

Q33 Valuation of livestock and manorial right are carried out by ����.
an accountancy
an auditor
farm experts
production sector

Q34 Large farms take insurance cover for loss of livestock due to
time consuming
infection or loss of cattle as a result of straying
infection or loss of sales in reduction
A & C

Q35 one major problem with the determination of a plantation is
plantation does not commence early but the last day
plantation does not usually start to produce until after a long gestation period
plantation discourage of large scale production
plantation takes much profit before harvest

Q36 In using appraised value method which of the following factor should be considered?
current market value mutuality factors and the marketability of livestock
Arable stock value and time of the stock
current market value &time value for money
Cost method &prudence method.

Q37 Cost method means â?¦.
adding all cost of every asset and input together
A & C
aggregate all cost to date on each class of livestock
1.    A & B

Q38 Which of the method can be used to value Arable stock?
it should be valued at cost or net realizable value
arable stock should be value at average stock
arable stock must be valued at FIFO
arable stock should be value at LIFO

Q39 What is one approach to valuation of stock of live stock?
cost approach, net realizable value
cost investment method and cost reduction
appraisal devaluation method
A & B

Q40 Which of the following expenses is not exclusive to farm accounting?
fertilizer expenses
dairy expenses
vehicle repair and maintenance expenses
feed expenses

Q41 Which of the following account are prepared by farmerâ??s
partnership account and joint account
trading, profit and loss account and balance sheet
control account and value added account
manufacturing and departmental stock account

Q42 What is the formula for eliminating realized profit from goods sent to branch at cost plus 25%
2.5% of realizable cost
2.5% of value of sold stock
25/125 of value sold stock at hand
25/125x value of unsold stock

Q43 What did you understand by semi autonomous branch in the context of branch accounting
it operate independent at every branch and need office
it operate almost as a separate entity independent of ite head office
semi autonomous branch operate departmental of the branch and head office
A & B

Q44 When is the temporal method applicable for translation of the financial statement of foreign branches?
it is usually applicable when foreign branch is periodic
it is usually applicable when foreign branch is autonomous
it is usually applicable when foreign branch is non autonomous
when goods are over sent

Q45 State how revenue and expense are translated under the closing rate method
revenue and expenses are translated of periodic rate value
revenue and expenses are translated at closing period
revenue and expenses are translated at average rate for the period
they are charge at average appropriate price value

Q46 Some of the reasons why branch current account may not agree with head office current account are:
goods sent is usually overcast
goods sent to branch account is some time under cast
cash in transit and stock in transit
cash and stock are sometime diminishing of decreasing

Q47 Transaction between the head office and independent branches are received in ��.
special ledger general
current account
goods sent account
branch adjustment account

Q48 Head office branch account is a mirror of which account?
branch stock to branch account
branch current account
goods sent to branch account
branch doubt account

Q49 One difference between an independent and dependent branch is
head office parents for dependent branches
accounting records and books are kept by the independent out branches
independent branches are allowed control over sales
B & A

Q50 Sales of goods at involved price between head office and branch will give rise to one of the following if the items are not sold to an external party, at the end of the period.
unrealized profit
profit to head office
foreign currency
increase in turnover

Q51 Which of the following method of translation would you recommend for an independent foreign branch
temporal method
mortuary method
current method
closing rate method

Q52 The liquidatorâ??s of Adebayo limited has settle all creditor of the company except three owed N150,000. At the commencement of the liquidation, the companyâ??s share capital was as follows: 1,000,000 10% preference share of N1 each 85 kobo paid=850. 6,000,000 ordinary share of 50 kobo each, 30 kobo paid=1800. * Calculate the amount of call on refund due to the preference shareholders
150,000 refund
N150, 000 call
N50 call
N300,000 call

Q53 The liquidatorâ??s of Adebayo limited has settle all creditor of the company except three owed N150,000. At the commencement of the liquidation, the companyâ??s share capital was as follows: 1,000,000 10% preference share of N1 each 85 kobo paid=850. 6,000,000 ordinary share of 50 kobo each, 30 kobo paid=1800. *Assume that the preference share rank prior to the ordinary share. Calculate the call per ordinary shares
5 kobo
35 kobo
20 kobo
15 kobo

Q54 The liquidatorâ??s of Adebayo limited has settle all creditor of the company except three owed N150,000. At the commencement of the liquidation, the companyâ??s share capital was as follows: 1,000,000 10% preference share of N1 each 85 kobo paid=850. 6,000,000 ordinary share of 50 kobo each, 30 kobo paid=1800. *If the preference share rank prior to the ordinary shares, calculate the amount of call to be made by the liquidator
N150,000
N1,000,000
450000
1200000

Q55 The effect of bankruptcy on the private estate of the bankrupt is ���
the private estate will be to pay the bankruptâ??s debt to the extent the business asset are inadequate to settle the settle it
only the accrual debts
the debt will be shared
no debt will be pay back

Q56 A company is winding up if it is ���
unable to recover its asset
unable to account his Goodwill
unable to pay up his debt
balance his account

Q57 The word â??liquidationâ? means â?¦â?¦.
winding up
appreciation of a company
recovery a company
re-banking a company

Q58 When a partnership asset has been pledged for the personal debt of a partner, the creditor would claim as ���. and creditor in the ���� estate
secured creditor and joint estate
secured creditor and royal value
unsecured creditor and joint estate
partnership creditor and partnership estate

Q59 Which of the following would contribute to deficiency in liquidation of a company (i) discount on accrued liabilities (ii) liquidation fees (iii) preference divided waved by investors (iv) formation expense
I & II
II & IV
I, II & IV
I, II, III

Q60 Which of the following is a feature of the statement of affairs prepared when a company is being liquidated?
preferential creditors are paid before debenture with floating securities
the shareholders fund is revalued
asset on recorded at book values
A & C

Q61 One use of fire year financial summary is ��.
it may be added to forecast future performance
it provides accurate loss up to date
it increase stock appreciation
it reduce audit up to date

Q62 All the following are excepted to be found in published financial statement of a publicity quoted company except
cash flow statement
value added statement
director summary
the expropriation of assets

Q63 Which of the following item is found in the companyâ??s profit and loss account is described as exceptional item
substantial loss sustain as a result of robbery attack
writing off of Goodwill
discontinuance of a significance put of a business
the expropriation of assets

Q64 Directors report in the financial statement need not disclose
forecast future profitability
principal activities of the company
result of the company for the period
change in board members during the period

Q65 Which of the following should not be classified on a current liability in a financial statement?
provision for staff gratuity
trade creditor and accruals
band overdraft
dividend payable

Q66 The generally accepted accounting principle, which should be stated in a companyâ??s accounting polices as it related to inventory, is that stock should be valve at â?¦â?¦â?¦
lower of cost and net realizable valve
cost
realization cost
replacement cost

Q67 In accordance with section 334 of CAMA, cap c20, LFN 2004 the financial statement of a private company need not includes��.
auditors report
audit committee report
debtor report
note on the account

Q68 Which of these method of depreciation is used by company that make use of loosing tools
straight line method
reducing balance method
revaluation method
machine hour method

Q69 According to IAS 16, depreciation means��.
systematic allocation of cost over the estimated useful life
systematic increase in asset and reduction of liabilities
wear and tear treatment of valve for money
appreciation

Q70 Even, when the bad debts has been eliminated the accounts..
do not represent the true & fair views of the debtor
will usually represent true & fair view
will be transferred to profit & loss account & balance sheet
A and B

Q71 Bad debts are��.
recoverable debts
unrecoverable debts
Receivable debts
profit and loss appropriation debts

Q72 A balance sheet of a company is prepared as follows���.
Balance sheet as at 31st Dec 2014
Balance sheet for the year 2014
Balance sheet as for 21st Dec 2014
all of the above

Q73 Published profit and loss account is usually prepared ���.
as at 31st Dec 2014
for the year ended December 2014
for the account period of the year 2014
as at the account period 2014

Q74 On what basis is interest on loan recognized by banks in their P&L account
it is recognized on accrual basis but interest due for more than 90 days are suspended and recognized on cash basis
it is recognized on advanced basis
it is unpaid capital sum
it is charge to P&L account

Q75 Exceptional item ����
falls within the ordinary activities
falls within exceptional
exceptional item are excepted from tax
) it is deducted from profit after tax

Q76 An extraordinary item falls
outside the ordinary activities and are treated after profit on ordinary activities
it falls between the P & L and treated in the balance sheet
it fall in the ordinary activities and treated in the balance sheet
extraordinary item are usually written off to profit and loss account

Q77 Under the prudential guideline, facilities classified as doubtful refer to loans that have remained unpaid
after their due dates
for 90 – 180 days after their due dates
for 180 â?? 360 days after their due dates
over 7 years

Q78 Which of the following is a Non-bank financial institution?
commercial bank
development bank
mortgage bank
merchant bank

Q79 The asset in the balance sheet of a bank are arranged in the order of
liquidity
solvency
performance
security

Q80 The format in which the final account of a limited liability company should be published in Nigeria is prescribed by
statement of accounting standard (SAS)
company and allied matters act. C20 LFN 2004
international accounting standard
financial reporting standard (FRS)

Q81 One use of fire year financial summary is ��.
it may be added to forecast future performance
it provides accurate loss up to date
it increase stock appreciation
it reduce audit up to date

Q82 All the following are excepted to be found in published financial statement of a publicity quoted company except
cash flow statement
value added statement
director summary
the expropriation of assets

Q83 Which of the following item is found in the companyâ??s profit and loss account is described as exceptional item
substantial loss sustain as a result of robbery attack
writing off of Goodwill
discontinuance of a significance put of a business
the expropriation of assets

Q84 Directors report in the financial statement need not disclose
forecast future profitability
principal activities of the company
result of the company for the period
change in board members during the period

Q85 Which of the following should not be classified on a current liability in a financial statement?
provision for staff gratuity
trade creditor and accruals
band overdraft
dividend payable

Q86 The generally accepted accounting principle, which should be stated in a companyâ??s accounting polices as it related to inventory, is that stock should be valve at â?¦â?¦â?¦
lower of cost and net realizable valve
cost
realization cost
replacement cost

Q87 In accordance with section 334 of CAMA, cap c20, LFN 2004 the financial statement of a private company need not includes��.
auditors report
audit committee report
debtor report
note on the account

Q88 Which of these method of depreciation is used by company that make use of loosing tools
straight line method
reducing balance method
revaluation method
machine hour method

Q89 According to IAS 16, depreciation means��.
systematic allocation of cost over the estimated useful life
systematic increase in asset and reduction of liabilities
wear and tear treatment of valve for money
appreciation

Q90 Even, when the bad debts has been eliminated the accounts..
do not represent the true & fair views of the debtor
will usually represent true & fair view
will be transferred to profit & loss account & balance sheet
A and B

Q91 Bad debts are��.
recoverable debts
unrecoverable debts
Receivable debts
profit and loss appropriation debts

Q92 A balance sheet of a company is prepared as follows���.
Balance sheet as at 31st Dec 2014
Balance sheet for the year 2014
Balance sheet as for 21st Dec 2014
all of the above

Q93 Published profit and loss account is usually prepared ���.
as at 31st Dec 2014
for the year ended December 2014
for the account period of the year 2014
as at the account period 2014

Q94 On what basis is interest on loan recognized by banks in their P&L account
it is recognized on accrual basis but interest due for more than 90 days are suspended and recognized on cash basis
it is recognized on advanced basis
it is unpaid capital sum
it is charge to P&L account

Q95 Exceptional item ����
falls within the ordinary activities
falls within exceptional
exceptional item are excepted from tax
) it is deducted from profit after tax

Q96 An extraordinary item falls
outside the ordinary activities and are treated after profit on ordinary activities
it falls between the P & L and treated in the balance sheet
it fall in the ordinary activities and treated in the balance sheet
extraordinary item are usually written off to profit and loss account

Q97 Under the prudential guideline, facilities classified as doubtful refer to loans that have remained unpaid
after their due dates
for 90 – 180 days after their due dates
for 180 â?? 360 days after their due dates
over 7 years

Q98 Which of the following is a Non-bank financial institution?
commercial bank
development bank
mortgage bank
merchant bank

Q99 The asset in the balance sheet of a bank are arranged in the order of
liquidity
solvency
performance
security

Q100 The format in which the final account of a limited liability company should be published in Nigeria is prescribed by
statement of accounting standard (SAS)
company and allied matters act. C20 LFN 2004
international accounting standard
financial reporting standard (FRS)

Q101 One use of fire year financial summary is ��.
it may be added to forecast future performance
it provides accurate loss up to date
it increase stock appreciation
it reduce audit up to date

Q102 All the following are excepted to be found in published financial statement of a publicity quoted company except
cash flow statement
value added statement
director summary
the expropriation of assets

Q103 Which of the following item is found in the companyâ??s profit and loss account is described as exceptional item
substantial loss sustain as a result of robbery attack
writing off of Goodwill
discontinuance of a significance put of a business
the expropriation of assets

Q104 Directors report in the financial statement need not disclose
forecast future profitability
principal activities of the company
result of the company for the period
change in board members during the period

Q105 Which of the following should not be classified on a current liability in a financial statement?
provision for staff gratuity
trade creditor and accruals
band overdraft
dividend payable

Q106 The generally accepted accounting principle, which should be stated in a companyâ??s accounting polices as it related to inventory, is that stock should be valve at â?¦â?¦â?¦
lower of cost and net realizable valve
cost
realization cost
replacement cost

Q107 In accordance with section 334 of CAMA, cap c20, LFN 2004 the financial statement of a private company need not includes��.
auditors report
audit committee report
debtor report
note on the account

Q108 Which of these method of depreciation is used by company that make use of loosing tools
straight line method
reducing balance method
revaluation method
machine hour method

Q109 According to IAS 16, depreciation means��.
systematic allocation of cost over the estimated useful life
systematic increase in asset and reduction of liabilities
wear and tear treatment of valve for money
appreciation

Q110 Even, when the bad debts has been eliminated the accounts..
do not represent the true & fair views of the debtor
will usually represent true & fair view
will be transferred to profit & loss account & balance sheet
A and B

Q111 Bad debts are��.
recoverable debts
unrecoverable debts
Receivable debts
profit and loss appropriation debts

Q112 A balance sheet of a company is prepared as follows���.
Balance sheet as at 31st Dec 2014
Balance sheet for the year 2014
Balance sheet as for 21st Dec 2014
all of the above

Q113 Published profit and loss account is usually prepared ���.
as at 31st Dec 2014
for the year ended December 2014
for the account period of the year 2014
as at the account period 2014

Q114 On what basis is interest on loan recognized by banks in their P&L account
it is recognized on accrual basis but interest due for more than 90 days are suspended and recognized on cash basis
it is recognized on advanced basis
it is unpaid capital sum
it is charge to P&L account

Q115 Exceptional item ����
falls within the ordinary activities
falls within exceptional
exceptional item are excepted from tax
) it is deducted from profit after tax

Q116 An extraordinary item falls
outside the ordinary activities and are treated after profit on ordinary activities
it falls between the P & L and treated in the balance sheet
it fall in the ordinary activities and treated in the balance sheet
extraordinary item are usually written off to profit and loss account

Q117 Under the prudential guideline, facilities classified as doubtful refer to loans that have remained unpaid
after their due dates
for 90 – 180 days after their due dates
for 180 â?? 360 days after their due dates
over 7 years

Q118 Which of the following is a Non-bank financial institution?
commercial bank
development bank
mortgage bank
merchant bank

Q119 The asset in the balance sheet of a bank are arranged in the order of
liquidity
solvency
performance
security

Q120 The format in which the final account of a limited liability company should be published in Nigeria is prescribed by
statement of accounting standard (SAS)
company and allied matters act. C20 LFN 2004
international accounting standard
financial reporting standard (FRS)

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