JAMB Accounting Past Questions & Answers - Page 153

761.

The prime cost is the total of the?

A.

Production cost + selling expenses

B.

Direct material + direct labour + direct expenses

C.

Direct material + work overhead expenses

D.

Administrative expenses + selling + distribution expenses

Correct answer is B

The prime cost is the summation of all direct expenses and direct materials used in production. Its simply direct cost incurred during production.

762.

The depreciation on a motor vehicle that is being used for manufacturing and administration is charged to the?

A.

Debit side of manufacturing and profit and loss account

B.

Debit side of profit and loss account only

C.

Credit side of profit and loss account only

D.

Debit side of manufacturing and balance sheet

Correct answer is B

The profit and loss account is used by manufacturing concerns to ascertain the cost of production at various stages.  A motor vehicle used by a manufacturing company would be depreciated to the debit side of  profit and loss account.

763.

The gross loss on manufacturing is always transferred to the?

A.

Credit side of balance sheet

B.

Debit side of profit and loss account

C.

Credit side of profit and loss account

D.

Debit side of balance sheet

Correct answer is B

No explanation has been provided for this answer.