ACC204
A profit represents the surplus of revenue over expenses while a loss is
Answer: the excess of expenses over revenue
According to International Accounting Standards Board (IASB’s) conceptual framework for the preparation and presentation of financial statements, asset is
Answer: a resource controlled by the entity as a result of past events
The accounting process of entering transactions into the journal is called
Answer: journalising.
Given that insurance incurred by an entity in a financial year is N20,000 but the firm has paid N17,000 only, the entire N20,000 incurred during the year must be charged to the
Answer: profit or loss account
The assets that have the capacity to generate economic benefits to an entity within one financial year is
Answer: current asset
N10,000 received from John Marku was entered on the payments side of the cash book with the double entry completed in his account. The journal entries to correct the error are
Answer: dr. john marku account n10,000 cr. cash book with n10,000
which of this allowances are applicable to other debts or customers’ debts in which the likelihood of their non-collectability is not discernible.
Answer: general allowance
In times of rising prices, what effect does the use of historical cost concept have on the values of a company’s assets and profit?
Answer: assets values and profits are both understated
Errors in account are basically classified into
Answer: 2
The means of communicating to interested parties, information on the resources, obligations and performance of the reporting economic entity or enterprise is
Answer: financial statement
Errors affecting the trial balance are corrected using
Answer: suspense
A special journal is designed
Answer: tabular
Assets, with a life-span of more than one year, within the business on an ongoing basis, in order to generate revenue are called
Answer: non-current assets
Financial structure comprises
Answer: short-term and long-term
According to International Accounting Standards Board (IASB’s) conceptual framework for the preparation and presentation of financial statements a Liability
Answer: a present obligation of the entity arising from past events
Which of the following concepts is applied when revenue recognised in an accounting year are charged with the cost of generating such revenue?
Answer: matching
Given that, a owner of a business invests cash of N100,000 into his business, the usual postings in the ledger would be to
Answer: debit cash account and cerdit capital account
Depreciation is
Answer: the part of the cost of non-current asset consumed during its period of use by the company
Non Current assets are distinguished from current assets by the following characteristics EXCEPT
Answer: usually stock in trade
Which of the following is the effect of a reduction in the provision for doubtful debts?
Answer: increase in net profit
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