Financial Accounting

Question 1

1Subscriptions owing by members of a club at the year end are treated as

Easy

A. a current asset B. income received in advance C. an expense D. a current liability

Question 2

2In the absence of a partnership agreement, the Partnership Act provides that profits are shared

Medium

A. in the capital ratio B. according to experience C. by age D. equally

Question 3

3Debentures are

Easy

A. ordinary shares B. current assets C. dividends D. long-term loans to a company

Question 4

4Bonus shares are issued

Hard

A. for cash to the public B. free to existing shareholders from reserves C. to directors only D. to creditors

Question 5

5A company issues 10,000 shares of GH¢1 at GH¢1.50. The share premium is

Hard

A. GH¢15,000 B. GH¢10,000 C. GH¢1,500 D. GH¢5,000

Question 6

6Interest on partners' drawings is

Medium

A. a business expense B. added to profit available for sharing C. a liability D. deducted from profit

Question 7

7Subscriptions owed by club members at the year-end are

Easy

A. a liability B. capital C. subscriptions in arrears (a current asset) D. subscriptions in advance

Question 8

8Opening capital GH¢8,000, closing capital GH¢12,000, drawings GH¢2,000, no new capital. Profit is

Hard

A. GH¢4,000 B. GH¢10,000 C. GH¢6,000 D. GH¢2,000

Question 9

9In a club's accounts, an excess of income over expenditure is a

Easy

A. capital gain B. gross profit C. surplus D. profit

Question 10

10A and B share profits 3 : 2. Profit of GH¢10,000 gives A

Hard

A. GH¢3,000 B. GH¢4,000 C. GH¢5,000 D. GH¢6,000