Use the following information to answer this question
| Year | ₦ |
| 1991 1992 1993 1994 |
14,000 24,000 10,000 16,000 |
It has been decided to value goodwill at 2 years purchase of average profit for the past 4 years. The value of goodwill is
32,000
16,000
30,000
64,000
Correct answer is B
| Average | profit | = | 14,000 + 24,000 + 10,000 + 16,000
4 |
| = | 64,000
4 |
= | ₦16,000 |
Shares that are offered to existing shareholders at a price is called
Par
Premium
Right issue
Bonus issue
Correct answer is C
Right issue are offered to existing shareholders in a company.
An ordinary share of ₦100 was issued at ₦80. The share was issued at
Premium
Par
Discount
Loss
Correct answer is C
Share issued at discount is a situation whereby shares are quoted below the nominal value.
Opening stock Purchases Sales Closing Stocks |
₦ 20,000 70,000 100,000 15,000 |
What was the gross profit?
₦35,000
₦75,000
₦50,000
₦25,000
Correct answer is D
Gross profit = sales - cost of goods sold
100,000 - 75,000
⇒ ₦25,000
| Opening stock | ₦ |
| Department A B |
100 800 |
| Purchases: A B Wages of workers Salaries |
1500 2000 50 100 |
| Sales A B |
3000 5000 |
Expenses are to be shared in the ratio of sales.
What was the cost of goods sold?
₦25,000
₦35,000
₦50,000
₦75,000
Correct answer is D
Cost of goods sold = Opening stock + Purchases - closing stocks
20,000 + 70,000 - 15,000
⇒ ₦75,000