WAEC Accounting Past Questions & Answers - Page 283

1,412.

Which of the following does not form part of shareholders fund?

A.

Ordinary shares

B.

Shares premium

C.

Profit

D.

Debenture

Correct answer is D

Debentures are a long-term security yielding a fixed rate of interest, issued by a company and secured against assets. It is a debt security issued by a company by a company to raise money. The holders are paid the amount lended with interest. They are not a source of equity financing. 

1,413.

When shares are sold 'at par' it means they are issued at

A.

The market value

B.

The nominal value

C.

A discount

D.

A premium

Correct answer is B

When shares are issued at a price equal to their face value it is termed as shares issued at par. Par value is also known as nominal value or face value.

1,414.

Which of the following reserves is not used for bonus shares?

A.

Revolution reserve

B.

Share premium

C.

Capital redemption reserve fund

D.

General reserve

Correct answer is C

Capital redemption reserves fund is a part of a company's reserves and capital from money invested in shares that is not allowed to be given to shareholders in the form of dividends.

1,415.

A financial plan of action expressed in monetary terms is a/an

A.

Warrant

B.

Budget

C.

Imprest

D.

Consolidated fund

Correct answer is B

A budget is an estimation of revenue and expenses over a specified future period of time. Creating this spending plan allows you to determine in advance whether you will have enough money to do the things you need to do or would like to do. Budgeting is simply balancing your expenses with your income.