ACCOUNTING MOCK EXAM QUESTIONS FOR SS3
SS3 FINANCIAL ACCOUNTING MOCK EXAM QUESTIONS –EDUDELIGHT.COM
MOCK EXAMINATION
Examination malpractices may lead to a repeat of the subject or suspensions don’t be involved.
SUBJECT: FINANCIAL ACCOUNTING TIME ALLOWED: 3HRS CLASS: S.S 3
OBJECTIVES QUESTION
- Investors in a business are mainly interested in the firm’s
- Liquidity B. Debt. C. Management. D. Profitability.
- One of the characteristics of useful accounting information is.
- Profitability. B. Comparability. C. Efficiency. D. Liquidity.
- Which of the following item is found on the debit side of a trial balance?
- Provision for doubtful debts. B. Discount allowed. C.Discount received. C. Returns outwards.
- Which of the following transactions is a revenue expenditure?
- Purchase of a plant. B. Purchase of a new engine. C. Construction of office wall. D. Purchase of fuel for vehicle.
- Credit notes received are source documents for
- Returns Inwards Journal. B. Returns Outwards Journal. C.Purchase journal.
D. Sales Journal.
- A document forwarded to a supplier showing amount due for unsatisfactory goods is
- Debit Note. B. Credit Note. C.Invoice. D. Waybill.
- A claim of a proprietor of a business entity on its assets is
- Liabilities. B. Capital. C.Drawings. D. Funds.
- The apportionment of cost of a fixed asset to the profit and loss account is termed as
- Expense. B. Depreciation. C. Loss. D. Appreciation.
- Entries in the purchase journal are transferred to the
- Receivable ledger. B.Payable Ledger. C. General ledger. D. Private ledger.
- A reduction in price to encourage prompt payment is
- Trade discount. B. Quantity discount. C. Cash discount. D.Seasonal discount.
Use the following information to answer question 11 and 12.
Tei Ltd offered 1,560 units of a magazine at ₦60.00 each. Trade discount is 10% and cash discount is 10% within 30 days and 5% within 60 days.
- The amount payable if payment is made on the 40th day is
- ₦88,920. B. ₦84,240. C. ₦80,028. D. ₦72,025.
- The cash discount allowed on the 50th day is
- ₦9,360. B. ₦8,424. C. ₦4,680. D.₦4,212.
- An amount of Le 2000 received from a customer, Kofi has been credited to another customer, Kofigo’s account. This is an error of
- Principle. B.Commission. C.Original entry. D.Complete reversal.
- Current assets less current liabilities is
- Working capital. B. Capital employed. C. Fluctuating capital. D.Fixed capital.
- A debit balance of GH₵ 420 on the Purchases Ledger Control Account means that as at that date
- Trade creditors have been overpaid by GH₵ 420.
- Trade creditor are owed GH₵ 420
- Goods returned to trade creditors amounted to GH₵ 420.
- Total supplies from trade creditors amounted to GH₵ 420.
- Sales and purchases ledgers are used in a business to keep records of
- The owner’s capital and cash transaction. B. Accounts of individual customers and suppliers. C. Current assets and fixed assets. D.Current liabilities and long-term liabilities.
- Which of the following activities will increase profits?
- Depreciation charges. B. Reduction in provision for doubtful debts.C. Undervalued closing stock. D. Returns inwards
18. The concept that implies that a business will operate for an indefinety periosd of time is A. Accrual concept. B. Going concern concept. C. Business entity concept. D.Periodicity concept.
19. The consistency concept aims at? Ensuring that all expenses are matched against revenue. B. Reduction cost. C. Comparability of accounting records. D.Suppressing profits to be declared.
20.The concept which states that revenue is recognized when goods are sold is?
- Realization concept. B.Matching concept. C. Periodicity concept.
D. Going concern concept.
21. Cost of goods sold is calculated as
- Opening stock + purchases – closing stock. B. Opening stock + Sales – closing stock. C. Opening stock + Purchases + Closing stock D.Opening stock + sales + Closing stock.
22. The wages of an officer cleaner is classified as
- Direct labour cost. B. Direct expenses. C. Factory overheads. D. Administrative overhead.
Use the following information to answer question 23 and 24.
Le
Sales 120,000
Purchases 100,000
Opening stock 10,000
Closing stock 20,000
23.The cost of goods sold is A.Le 120,000. B.Le 110,000. C. Le 90,000.D. Le 30,000.
24. The gross profit or loss is A. Le 30,000 gross profit. B. Le 20,000 gross profit. C.Le 10,000 gross loss. D. Le 30,000 gross loss.
25. The amount set aside out of profits to strengthen the financial position of the business is A. Provision. B. Reserve. C. Depreciation. D. Surplus.
26.A fall in value of a fixed asset due to technological changes is described as
- Superfluity. B. Wear and tear. C. Obsolescence. D. Depletion.
27. A credit entry is made in the Plant and Machinery Account for the
- Purchase of an additional plant and machinery. B. Sale of plant and machinery.
C. Maintenance of plant and machinery. D.Appreciation of the plant and machinery.
28. In a manufacturing account, royalties paid is
- Debited to the trading account. B. Credited to the profit and loss account.
C. Credited to the manufacturing account. D. Debited to the manufacturing account.
29. One of the component of factory overhead is
- Raw materials consumed. B. Manufacturing wages. C. Carriage inwards.
D. Depreciation of plant and machinery.
Use the following information to answer question 30 and 31.
GH₵
Direct material used 64,000
Direct labour 30,000
Production overheads 22,000
Work in progress at beginning 9,000
Work in progress at close 14,000
30. Total cost of production is A. GH₵ 94,000. B. GH₵ 106,000. C.GH₵ 111,000.
D. GH₵ 116,000.
31.Prime cost of production is A. GH₵ 64,000. B. GH₵ 94,000. C.GH₵ 111,000
D. GH₵ 116,000.
32. The balance on the sales ledger control account at the end of the accounting year represents total A. Trade debtors at the end of the year. B. Cash sales for the year. C. Credit sales for the year. D. Amount transferred from the sales journal.
Use the following information to answer questions 33 and 34.
01/01/2016 31/12/2016
D D
Trade debtors 80,000 100,000
Trade creditors 30,000 40,000
Stock 70,000 90,000
Cheques received from trade
Debtors in2016 : D 350,000
Payment made to trade
Creditors in 2016 : D 220,000
33.Credit sales for 2016 is A. D 530,000. B.D 370,000. C. D 350,000. D. D 330,000.
34. Credit purchased for 2016 is A. D 290,000. B. D 230,000. C. D 220,000.D. D 210,000.
35. The excess of assets over liabilities of a not-for-profit making organization is
- Surplus. B.Deficit. C. Working capital accumulated fund. D. Accumulated fund.
Use the following information to answer question 36 and 37.
Receipt of payment : 31st December, 2016
₦ ₦
Cash at bank 460 New Equipment 200
Subscription 520 Cleaners wages 540
Donations 500 Stationery 140
Sales of tickets 490 Repairs 110
Entrance fees 670
36.The surplus for the year is A. ₦1,970. B. ₦1,890. C. ₦1,690. D.₦1,390.
37. The total income received for the year is
- ₦2,640. B. ₦2,180. C. ₦1,890. D. ₦1,690.
38. The parties who are paid last in the event of winding up are
- Preference shareholder. B. Debenture shareholder. C. Ordinary shareholder.
D. Trade creditors.
39. An event will not require a change in the profit-sharing ratio of partners in a firm is when A. A partner dies. B. A partner retires. C. A new partner is admitted.
D. Partner assets value appreciated.
Use the following information to answer questions 40 and 41.
₦
Net profit 17,460.
Capital account: Taiwo 50,000.
Obi 40,000
Drawing account: Taiwo 12,000
Obi 10,000
Salary – Obi 1,500
Interest on capital 5
Interest on drawings 4
Profit sharing ratio is 3:2 for
Taiwo and Obi respectively.
40. Taiwo’s share of profit is A. ₦8,960. B. ₦7,404. C. ₦4,936. D. ₦3,296.
41.Obi’s share of profit is A. ₦8,960. B. ₦7,404. C. ₦4,936. D. ₦3,296.
42. The accounting entries for cash realized from the sale of assets on dissolution of partnership is debit. A. Cash Account; credit Partners Capital Account. B. Asset Account; credit Realisation Account. C.Cash Account; credit Realisation Account. D. Realization Account; credit Cash Account.
43. The process of distributing shares to successful applicant is
- Allocation. B. Apportionment. C. Allotment. D. Application.
44. Interim dividend paid in the year is A.Debited to the Profit and Loss Account. B.Debited to the Income Surplus Account. C.Credited to the Profit and Loss Account. D.Credited to the Income Surplus Account.
45. The basis of apportionment of insurance on building in departmental account is
- Floor space occupied by the department. B.Purchase cost of the building.
C. Value of the building. D. Number of offices in the building.
46. Under the cost method in Branch Accounts, branch gross profit is disclosed in the A. Goods sent to branch account B. branch debtors account C. branch stock account D. branch stock adjustment account
Use the following information to answer question 47 and 48.
Le
Ordinary share capital 70,000
Retained earnings 31,142
Motor vehicle at cost 21,136
Accumulated depreciation motor vehicle 7,109
Furniture and fitting at cost 1,334
Accumulated depreciation-furniture of fittings 1,007
Stock 32,200
Debtors 49,380
Bank 15,953
Creditors 11,329
47. Equity holders fund is A. Le 112.471 B. Le 111,834 C. Le 101,142 D. Le 70,000
48. Net book value of fixed assets is Le 22,480. B. Le 21,136. C. Le 14,354. D. Le 14,027.
49. The authority to incur expenditure in the public sector is
- Warrant . B. Vote. C. Budget. D. Voucher.
50. Below-the-line item in public sector accounting means such an item is
- Not budgeted for in the current fiscal year.
- Budgeted for in the current fiscal year.
- To be carried forward to the next fiscal year.
- Less than what is budgeted for.
SS3 FINANCIAL ACCOUNTING MOCK EXAM QUESTIONS –EDUDELIGHT.COM
SECTION B: ANSWER ANY TWO QUESTIONS FROM THIS SECTION
1a. What is a source document?
b. List six types of source document
c. State three uses of subsidiary books
2a. State three reasons for preparing a bank reconciliation statement
b. What is a bank reconciliation statement?
c. State two limitations of accounting information
3a. Explain the following terms used in non profit making organizations
I. Accumulated fund II. Subscription in arrears III. Receipt and payment
iv. Income and expenditure account v. Entrance fees
b. Distinguish between shares and debentures
4a. List six users of accounting information
b. State the formula and the use of each of the following ratios:
I. Quick ratio II. Net profit margin III. Total assets turnover iv.Creditor payment period(in days)
SECTION C
ANSWER QUESTION FIVE AND ANY OTHER TWO QUESTIONS
5. The trial balance of Okoli for year ended 31st December, 2016 was provided as follows :
# #
Capital. 630,000
Drawings. 69,000
Opening stock. 300,000
Purchases and sales 1,050,000. 1,200,000
Returns. 15,000. 18,600
Debtors and Creditors. 29,400. 21,000
Provision for doubtful debts. 2,400
Salaries. 90,000
Rates. 18,000
Insurance. 93,000
Telephone. 3,000
Furniture at cost. 120,000
Machinery at cost. 90,000
Provision for depreciation
Furniture. 30,000
Machinery. 15,000
Bad debt. 600
Bank balance. 39,000
Total. 1,917,000. 1,917,000
Additional information :
a. Closing stock. 360,000
b. Rates prepaid. 1,500
c. Telephone outstanding 660
d. Provision for doubtful debts is to be increased to 10% of debtors
e. Depreciation on furniture at 10% on book value
f. Depreciation on machinery at 20% on cost
Required : prepare trading,profit and loss account for the year ended 31st December 2016 and a Balance sheet as at that date
6. The trial balance of Ayomide Enterprises failed to agree. The difference was entered in the suspense account
The following errors were later detected:
I. A sum of #1000 received from Saka has not been posted to his account
II. The sales day book was undercast by #560
III. Return outwards books was overcast by #140
iv. Discount received, #410 from Damilola had been correctly entered in the cash book but not posted to Damilola account .
v. Goods worth #750 returned to a supplier was recorded in his personal account as #570
Vi. Discount allowed was overcast by #310
vii. Discount received column in the cash book has been overcast by #400
You are required to prepare :
a. Journal entries to correct the errors
b. Suspense account
7. Favour, Grace and David are partners engaged in retail business, sharing profit and losses in the ratio of 2:1:2 respectively.
The following are the details of the extract from their books as at 31st January 2013
Favour. Grace. David
Capital. 50,000. 45,000. 60,000
Current account. 20,800. ( 5000) 8,500
Additional information :
I. The firms sundry assets were valued at 431,000
II. The firms was cash strapped and on 1/07/2013,Grace advanced a loan of 100,000 to the partnership at the rate of 5% per annum. Interest was payable six monthly and was to be credited to his account
III. Favour and David were to receive salaries of 25,000 per annum each
iv. The profit for the partnership before charging loan interest was 158,000 for the year ended 31st December 2013. The loan was not repayable until after the year 2016
You are required to prepare :
a. Profit and loss appropriation account for the year ended 31st December 2013
b. Partners current account in a columnar form.
8. On 31st December, 2016,the bank column of the cash book of Aminata enterprise showed a debit balance of D48,500. However, bank statement showed a credit balance of D54,900 as on the same date.
A detailed comparison of entries revealed the following:
a. Customer cheques amounting to D8,450 had not been credited by the bank as at 31/12/2016
b. Cheques amounting to D8,850 had not been presented for payment as at 31/12/2016
c. Bank charges of D1,000 and interest on investment of D2,500 collected by the banker appeared only in bank statement
d. On the 30/12/2016,there was a wrong credit of D3,500 in the bank statement
e. Jesse enterprise,a customer, had paid into the bank directly a sum of D3,000 on 29th
December 2016.this had not been entered in the cash book.
f. A cheque for D2,000 received from Jallo enterprise a customer which was deposited had
been returned unpaid. This had been entered in the cash book
Prepare :
a. Adjusted cash book
b. Bank reconciliation statement as at 31st December 2016.
9. Chidubem social club presented the following statements for the year ended 31st December 2016. Chidubem social club
Receipt and payment account
Le. Le
Balance b/f 5,700. Maintenance of building 12,600
Subscription 54,500.Maintenance of ground. 6,400
Bar sales. 13,040 Prizes for fun fair. 8,400
Fun fair proceeds.4,300 Bar purchases. 8,000
Donations. 2,000 Bar expenses. 2,000
Life membership
dues. 5,400. Funeral expenses. 10,200
Sale of magazines 12,560. Staff salaries. 30,000
General expenses 3,600
Donations to hospital 12,500
Printing of magazines 5,300
Balance c/d. 11,000
97,500. 97,500
Additional information
01/01/16. 31/12/16
Le. Le
Subscription in arrears. 3,900. 7,400
Subscription in advance. 8,400. 6,300
Bar stock. 1,500. 2,200
Bar debtors. 2,630. 3,930
Bar expenses owing. 540. 370
Five new members had not paid membership dues of Le300 each for the year
You are required to prepare for Chidubem social club for the year ended 31st December 2016
a. Subscription account , b. Bar trading account
c. Income and expenditure account for the year ended 31st December 2016
SS3 FINANCIAL ACCOUNTING MOCK EXAM QUESTIONS –EDUDELIGHT.COM
Answer to question 5 in section C