If you are preparing for an accounting aptitude test or even a job interview, these accounting questions and answers will help you master the principles of accounting. This test covers accounting past questions from WAEC, JAMB, Post UTME exams and many more.
A balance sheet
A budget
An income and expendiure account
A cash bookÂ
Correct answer is B
A budget is an estimation of revenue and expenses over a specified future period of time; it is compiled and re-evaluated on a periodic basis.
Which of the following item is not treated in the profit and loss account?
Office expenses
Salaries and allowances
Carriage inwards
Discounts allowed
Correct answer is B
A profit and loss account will include your credits (which includes turnover and other income) and deduct your debits (which includes allowances, cost of sales and overheads). These are used to find your bottom line figure – either your net profit or your net loss.
Subscription in advance is classified in the balance sheet as
An asset
A liability
A deficit
A surplus
Correct answer is B
When a company receives money in advance of earning it, the accounting entry is a debit to the asset Cash for the amount received and a credit to the liability account such as Customer Advances or Unearned Revenues. The subscription in advance is a liability because it is a future earning that will be due in future, it means the company is owing outsiders the said amount tied to the payment.
Which of the following information is recorded in the returns outwards book?
Goods purchased on credit and susequently returned to suppliers
Fixed asset bought on credit and subsequently returned to supplier
Cash payment received from a customer and subsequently returned to supplier
Goods sold to a customer and subsequently returned to the business
Correct answer is A
Returns outwards are goods returned by the customer or business to the supplier. For the supplier, this results in the following accounting transaction: A debit (reduction) in revenue in the amount credited back to the customer.
Business entity
Materiality
Dual aspect
Realization
Correct answer is B
The materiality principle states that an accounting standard can be ignored if the net impact of doing so has such a small impact on the financial statements that a reader of the financial statements would not be misled.