1. Which of the following describes a trial balance?

A. it is a special account

B. it is a list of balances in the books

C. it reveals the financial position of a business

D. it shows all the entries in the books of a business


2. Which of the following is not a feature of accounting information?

A. Affordability

B. Timelines  

C. Accuracy

D. Completeness


3. Which of the following is the equation for determining net profit for loss from the records of a firms?

A. Closing capital – Drawing – Capitals Introduced

B. Opening Capital + Drawing  – Closing Capital

C. Closing Capital + Opening Capital  – Drawings

D. Closing Capital +Drawing – Opening Capital


4. Purchases invoice is first entered in the

A. Purchases account

B. cash book

C. sales journal

D. purchase journal


5. Assets acquired is recorded by debiting

A. Asset Account, crediting Cash Account

B. Cash Account, crediting asset account

C. Purchase of Business Account, crediting Sale of Business Account

D. Asset Account, credit purchase of business Account


6.Goods returned to a supplier is

A. debited to Returns outwards

B. credit to Returns outwards account

C. debited to Returns inward accounts

D. credited to Returns inwards accounts


7. Which of the following is a real account?

A. Plant account

B. Salaries account

C. creditors account

D. Trading account


8. The accounting ledger for goods sold on credit are debit

A. Debtors Accounts, credit Sales Account

B. credited to Returns outward account

C. debited to Returns inwards account

D. credited to Returns inwards account


9. Which of the following is not a book of original entry?

A. Sales journal

B. Purchases account

C. Cash account

D. Returns inwards journal


10. What is the ledger entry for the sale of plant and machinery on credit to Wilson?

A.  Credit Sales Account and debit Cash Account

B. Credit Plant and Machinery and debit Wilson’s Account

C. Credit Sales Account and debit Wilson’s account

D. Credit plant and Machinery Account  and debit Cash Account


11. Discount received Account is

A. real account

B. personal account

C. nominal account

D. profit and loss account


12. Which of the following account has a credit balance?

A. Capital

B.  Cash

C. Drawings

D. Premises


13. The accounting entry to correct sales day book overcast is

A. debit Sales Account and credit Debtor Account

B. debit Suspense Account and credit Sales Account

C. debit  Debtors Account and credit Suspense Account

D. debit Sales Account and credit Suspense Account


14. Which of the following expresses the accounting equating?

A. Capital +Asset = Liabilities

B. Assets – Liabilities = Capital

C. Liabilities +Current Assets = Fixed Assets

D. Liabilities – capital = Current Asset


15. When the invoice of a customer is overcast, the supplier will sent to him a

A. cheque

B. payment voucher

C. debit note

D. credit note


16. Unpresented cheque are cheque  

A. that have been recorded in the cash book, but not by the bank

B. that have been received by the bank, but recorded in the cash book

C. returned by the bank

D. written, but not handed over to customers


Use the following information to answer question 17 to 19

                                                                                    Dr                                Cr

                                                                                    GH¢                            GH¢

Advertising                                                                 36,000                         ---

Electricity                                                                    60,000                         ----

Advertising was paid by cheque covering 12 monthly instalments and ending March 31, 2012

Electricity was paid by cash covering 15 monthly instalments from March 1, 2011


17. Advertising owing in respect of the year ended June 30, 2012 is

A. GH¢12,000

B. GH¢9,000

C. GH¢5,000

D. GH¢3,000


18. What was the amount charged to the profit and loss account in respect of advertising for the year ended June 30, 2012

A. GH¢36,000

B. GH¢30,000

C. GH¢27,000

D. GH¢24,000


19. Electricity in arrears as at June 30, 2012 amounted to

A. GH¢ 12,000

B. GH¢ 30,000

C. GH¢ 27,000

D. GH¢ 24,000


20. The cost of putting goods into a saleable condition is charged to

A. balanced sheet

B. trial balance

C. profit and loss account

D. trading account


21. Which of the following is not a method of depreciating fixed assets

A. Revaluation

B. Straight line

C. Diminshing balance

D. Obsolescence


22. In preparing a Profit and Loss Account,  a decrease in provision for doubtful debts  accounts is treated as

A. Currentiability

B. expenses

C. Income

D. Current Asset


23. Which of the following items is found in sales ledger control account?

A. Discounted received

B. Total credit purchases

C  Discount allowed

D. Returns outwards


24.The process of using sales ledger balance to cancel off purchases ledger is

A. balancing

B. set off

C. reconciliation

D. cancelling


25. The total of the returns outwards journal is posted to the

A. credit side of the returns outwards book

B. debit side of the returns outwards account

C. debit side of the purchases returns book

D. credit sides of the returns outwards accounts


26. Which of the following is not revealed by a firm’s accounting records?

A. Profit of a period

B. Quality of labour force

C. Credit worthiness

D. Value of assets


Use the following information to answer question 27 to 29

                                                                        1/7/10              30/5/11

                                                                        D                     D

Stock                                                               1,460               4,200

Motor Van                                                      3,600               3,200

Creditors                                                         600                  700

Drawing during the year amounted to D1,600


27. Opening capital is

A.  D 6,660

B.  D 5,060

C.  D 4,460

D.  D2, 960



28.  Closing capital is

A. D 8,100

B. D7,400

C. D6,700



29. net profit for the year is

A. D12,260

B. D3,740

C. D2,440

D. D2, 040


30. In the balance sheet of a social club, subscription owing is treated as a

A. current liability

B. current asset

C. tangible asset

D. long term liability


31. The accounting concept that allows the cost of kitchen cutlery to be expensed, though it will be used for more than one year is

A. materiality

B. accrual

C. going concern

D. business entity


32.  The accounting concept that assumes that a business will continue operating for an indefinite period is

A. business entity

B. going concern

C. consistency

D. duality



33. The accounting concept that states that a firm’s financial affairs must be separated from that of the owner’s private transaction is

A. business entity

B. going concern

C. consistency

D. duality


34.  Goodwill  is recognized in partnership account when

A. the business makes a huge profit

B. the business has good customer relationship

C. a partner is dormant

D. a new partner is admitted


35. In which of the following accounts is interest on partners capital found?

A.  Profit and loss

B. Trading

C. Income surplus

D. Profit and loss appropriation


36. Which of the following is not stated in the partnership agreement?

A. Profit sharing ratio

B. Interest on capital

C. Interest on fixed asset

D. Purpose of partnership


Use the following information to answer question 37 and 38

Mr White acquired Mr Black’s business for GH¢ 410,000. The total assets were GH¢670,000 and liabilities amounted to GH¢320,000.


37. How much was paid for goodwill?

A. GH¢300,000

B. GH¢200,000

C. GH¢90,000

D. GH¢ 60,000


38. The double entry to record  the goodwill in the books is debit

A. Cash Account and credit Goodwill Account

B. Goodwill Account and credit Purchase of Business Account

C. Goodwill Account and credit Cash Account

D. Purchase of Business Account and credit Cash Account


39. The document which sets out the internal arrangement for the proper management of a company is the

A. prospectus

B. article of association

C. memorandum of association

D. certificate of incorporation


40. A person who has applied to purchase shares in a company is referred to as

A. a promoter

B.a subscriber

C. an allottee

D. an underwriter


41. Which of the following expenses is allocated according to the floor area?

A. Wages and salaries

B. Rent and rates

C. Canteen expenses

D. Discount allowed


42. Goods stolen at the branch is debited to

A. Defalcattions Account

B. Branch stock Account

C. Branch Adjustment account

D. Branch Debtors Account


43. Which of the following is a source of revenue for a local government?

A. Personal income tax

B. Company registration fees

C. Royalties

D. Market tolls


44. The instrument used to release fund which the minister of finance had earlier withheld is

A. reserve expenditure warrant

B. supplementary general warrant

C. provisional general warrant

D. supplementary statutory warrant


45. Which of the following relates to cash basis of accounting?

A. Accounts and prepayment are considered

B. Debtors and creditors are recorded

C. Fixed assets are written off in the year of purchase

D. Profit are maximized


Use the following information to answer question 46 and 47

                                                                        Ade                 Bola

                                                                        N                     N

Capital                                                             40,000             30,000

Drawings                                                         10,000             15,000

Interest on Drawing is 5%

Profit us shared equally

Net profit for the period N4,250



46. Ade’s share profit  is

A. N5,500

B. N 4,250

C. N2,750

D. N1,250


47. Bola’s share of profit is

A. N4,500

B. N4,250

C. N3,000

D. N2,750

48. Which of the following is found on the credit side of a partnership’s appropriation of profit?

A. Interest on capital

B. Interest on drawing

C. share of profit

D. Drawings


49. Which of the following is a spreadsheet application?

A Excel

B Word

C. Internet

D. Windows


50. The quality of output information depends on the

A. quality of input data

B. time of processing

C. speed of processing

D. quantity of output device