JAMB UTME - Principles of Accounts - 2025
Question 1 Report
Suspense account is used in the correction of
Answer Details
A suspense account is a temporary account used to record the difference when the trial balance does not balance. The difference is posted to the suspense account until the errors are found and corrected. It is used for correcting errors that affect the agreement of the trial balance.
Question 2 Report
Which of the following is a primary source of entry into the debtors ledger?
Answer Details
Question 3 Report
Which of the following is a spreadsheet application?
Answer Details
Excel is a spreadsheet application consisting of rows and columns used to organize, sort, and manage data. It allows for performing various arithmetic operations on the data.
Question 4 Report
The cost of raw materials consumed is
Answer Details
Cost of raw materials consumed = Opening stock + Purchases − Closing stock
= 8,000 + 45,000 − 9,500 = ₦43,500.
Question 5 Report
The class of share to which payment of dividend depends on profit is
Answer Details
Ordinary shares carry dividends that depend on the company’s profits and are not fixed. Forfeited shares are shares taken back by the company due to non-payment of calls. Bonus shares are free additional shares issued to existing shareholders. Preference shares carry a fixed dividend, which is paid before dividends on ordinary shares.
Question 6 Report
A computer set bought for #150,000 was disposed for #45,000 after some years of use. The profit on disposal was #7,500. Accumulated depreciation at the time of disposal was
Answer Details
Accumulated depreciation
= Cost − Disposal price − Profit
= ₦150,000 − ₦45,000 − ₦7,500
= ₦97,500.
Question 7 Report
In partnership dissolution, an asset taken over by a partner is debited to
Answer Details
The accounting entries are: Debit Partners' capital account and Credit Realization account.
Question 8 Report
A feature of government accounting is that the
Answer Details
Government accounting is mainly based on the cash basis of accounting. Transactions are recorded only when cash is received or paid. Unlike the accrual basis, receivables and payables are not recognized.
Question 9 Report
The accounting principle that states that, in the preparation of an accounting statement, revenue is recognized as soon as goods are passed on to the customer is the
Answer Details
The realization concept states that revenue is recognized when it is earned and realizable, not when cash is received. This means revenue is recorded when goods are delivered or services provided. Thus, recognizing revenue as soon as goods are passed to the customer follows the realization concept.
Question 10 Report
The process of recording the financial transactions of government is
Answer Details
Public sector accounting involves recording, summarizing, analyzing, and reporting the financial transactions of the government. It covers the receipt, custody, and use of public funds, as well as accountability for them. Therefore, recording government financial transactions is part of public sector accounting.
Question 11 Report
Which of the following describe trial balance?
Answer Details
A trial balance is a list of all general ledger accounts, showing each account’s name and balance. Each balance is either a debit or a credit.
Question 12 Report
Discounts received are
Answer Details
Discounts received are a gain to the business and are therefore credited to the Profit and Loss Account. Since it is an income, the Discount Received account is credited. At the end of the period, it is transferred to the Profit and Loss Account by crediting the Profit and Loss Account.
Question 13 Report
Which of the following errors affects the agreement of a Trial Balance?
Answer Details
The trial balance will not agree if there is an error involving a single entry, such as a wrong addition in the sales account. This is because the trial balance totals all debits and credits in a double-entry system. Errors affecting two accounts will not affect the trial balance agreement.
Question 14 Report
Provision for depreciation on delivery van is charged to
Answer Details
Provision for depreciation on a delivery van is charged to the Profit and Loss Account. Depreciation is the reduction in value of an asset due to wear and tear or obsolescence, and it is treated as an expense when calculating net profit or loss.
Question 15 Report
Prime cost is
Answer Details
Prime cost = cost of raw materials consumed + direct expenses
= 43,500 + 6450 = #49,950
Question 16 Report
An example of a self-balancing account is the
Answer Details
A self-balancing account is one whose balance agrees with the total of the related subsidiary ledger. Control accounts (like Sales Ledger Control Account or Purchases Ledger Control Account) are designed for this purpose.
Question 17 Report
Which of the following is not a source document?
Answer Details
A source document is the original proof of a financial transaction, like sales invoices, debit notes, and credit notes.
A journal proper is not a source document; it is a book where unusual or miscellaneous credit transactions are recorded.
Question 18 Report
Which of the following is used before the appropriation bill is approved?
Answer Details
A provisional general warrant allows the government to withdraw money from the consolidated fund to run government activities before the appropriation bill is approved.
Question 19 Report
Resources owned and controlled by a business are classified as
Answer Details
Assets are resources owned and controlled by a business that have value. They can be tangible (physical things like buildings and equipment) or intangible (non-physical things like trademarks and patents).
Question 20 Report
In preparing a profit and loss account, a decrease in provision for doubtful debts accounts is treated as
Answer Details
In the profit and loss account, a decrease in provision for doubtful debts is treated as income. This happens because it means fewer bad debts are expected than previously estimated, so the difference is recorded as income.
Question 21 Report
Which of the following is not a credit item in the Sales Ledger Control Account?
Answer Details
In the Sales Ledger Control Account, credit items include cash received, discount allowed, and returns inward, as they reduce the amount owed by debtors.
A dishonoured cheque increases the debtor’s balance and is therefore debited, not credited. Hence, it is not a credit item.
Question 22 Report
The document which sets out the internal arrangement for the proper management of a company is the
Answer Details
The Articles of Association set out the internal rules for managing a company, including shareholders’ rights, directors’ powers, and meeting procedures. The Memorandum of Association governs the company’s external relations. The Prospectus invites the public to subscribe to shares, while the Certificate of Incorporation proves the company’s legal existence.
Question 23 Report
Which of the following is the basis of accounting in public service?
Answer Details
Public service accounting uses the cash basis, meaning revenues are recorded when cash is received and expenses when paid. This differs from the accrual basis, where transactions are recorded when earned or incurred, regardless of cash flow.
Question 24 Report
Use the following information to answer questions 11 and 12.
The surplus for the year is
Answer Details
Total income = 460 + 520 + 500 + 490 + 670 = ₦2,640
Total payment = 200 + 540 + 140 + 110 = ₦990
Surplus = Total income − Total payment = 2,640 − 990 = ₦1,650
Question 25 Report
If sales is D 12,000, and the gross profit markup percentage is 25%. What is the cost of sales?
Answer Details
Gross profit = 25% × D12,000 = D3,000
Cost of sales = Total sales − Gross profit = 12,000 − 3,000 = D9,000
Question 26 Report
One of the components of factory overhead is
Answer Details
Factory overheads are indirect manufacturing costs like depreciation of plant and machinery, utilities, rent, and indirect labor.
Raw materials and manufacturing wages are direct costs, while carriage inwards is a cost of transporting raw materials, not overhead.
Question 27 Report
In bank reconciliation, when a cash book shows a credit balance, uncredited cheques are:
I. deducted from the cash book balance
II. added to the bank statement balance
III. added to the cash book balance
Answer Details
In bank reconciliation, a credit balance in the cash book means the bank owes the business. Uncredited cheques—those issued but not yet presented to the bank—are deducted from the cash book balance.
Question 28 Report
When the going concern concept is no longer applicable, the fixed assets are recorded at their
Answer Details
The going concern concept assumes a business will keep operating indefinitely. If the business is closing, assets are recorded at their realizable value—the amount they can be sold for—not their original cost.
Question 29 Report
Production cost is
Answer Details
production cost = factory cost of production + opening W.I.P - Closing W.I.P
cost = 56,300 +3,250 -3,750 = #55,800
Question 30 Report
The objective of a departmental accounts is to ascertain the
Answer Details
The objective of departmental accounts is to determine the performance of each department. It involves keeping separate accounts for every department to assess their profitability and aid decision-making.
Question 31 Report
Which of the following is not credited to debtors control account?
Answer Details
Provision for bad debts is not credited to debtors control account. It is not an item of debtors control account. It is always ignored when it is given.
Question 32 Report
Factory cost of production
Answer Details
Factory cost of production = Prime cost + Factory overheads
= 52,950 + (2,800 + 3,200 + 350)
= 52,950 + 6,350 = 56,300.
Question 33 Report
Use the following information to answer this question
Rent for 2014 chargeable to the profit and loss account is
Answer Details
The rent for 2014 chargeable to the profit and loss account is calculated by adding the rent paid during the year to the rent prepaid at the beginning of the year and then subtracting the rent prepaid at the end of the year. This gives us ₦3,200 + ₦600 - ₦400 = ₦3,400.
Question 34 Report
The balance sheet as at 31st December, 2014, will show
Answer Details
The balance sheet as at 31st December, 2014, will show the amount of rent that has been prepaid and is yet to be used. This is the rent prepaid at the end of the year, which is ₦400
Question 35 Report
Which of the following is used before the appropriation bill is approved?
Answer Details
A provisional general warrant is issued before the appropriation bill is approved. It allows the government to withdraw funds from the consolidated fund to run government operations while the bill is under consideration.
Question 36 Report
Which of the following is not true of a trial balance?
Answer Details
A trial balance is an internal report used within the accounting department. It lists all debit and credit balances from the ledger for a period to check that total debits equal total credits.
Question 37 Report
Taiwo is a sole trader who keeps his petty cash on the imprest system, the imprest amount being #4,000.
The following transactions took place for a particular month:
Dec 1 petty cash in hand 517
1 petty cash to imprest 3,483
6 Bought notebooks 328
7 Paid wages 914
14 Bought postage stamps 375
16 Paid to J. Thomas, a creditor 536
21 Paid wages 928
23 Bought envelopes 437
27 Bought postage stamps 210
Amount spent on stationery is
Answer Details
The amount spent on stationery = the sum of the amounts spent on notebooks and envelopes
= # 328 + # 437 = # 765
Question 38 Report
Which of the following transactions is a revenue expenditure?
Answer Details
Revenue expenditure is money spent on the day-to-day running of a business. Its benefit lasts for less than one year, and it is charged in the same accounting year.
An example is the purchase of fuel for a vehicle, since it is a recurring expense with a short-term benefit.
Question 39 Report
Which of the following is not a source document?
Answer Details
A bank note is not a source document. Source documents provide evidence of business transactions, such as invoices, receipts, credit notes, and debit notes. A bank note is only a means of payment and does not record a specific transaction.
Question 40 Report
Use the following information to answer questions 11 and 12.
Receipt and Payments: 31st December, 2016
The total income received for the year is
Answer Details
Total income for the year = Cash at bank (₦460) + Subscriptions (₦520) + Donations (₦500) + Sales of tickets (₦490) + Entrance fees (₦670)
= ₦2,640.
