All practice questions

Kunle and Ngozi entered into a joint venture to deal in textile materials, agreeing to share profits and losses in the ratio $3:2$ respectively. Under the Memorandum Joint Venture method, where no separate set of books is maintained, the following transactions occurred:

- Kunle purchased goods for $\text{N}120,000$ and paid freight charges of $\text{N}10,000$.
- Ngozi purchased goods for $\text{N}80,000$ and paid storage fees of $\text{N}6,000$.
- Kunle incurred selling expenses of $\text{N}5,000$ and was entitled to a $5\%$ commission on sales made by him.
- Ngozi paid selling expenses of $\text{N}4,000$.
- Ngozi sold part of the venture goods for $\text{N}150,000$, while Kunle sold the remainder for $\text{N}110,000$.

Upon completion of the venture, what is the net amount payable by Ngozi to Kunle to effect final settlement?

Taribo and Ubong are partners operating under a fixed capital account system. On 1st January 2025, Ubong's current account had a credit balance of $\text{₦}150,000$. For the year ended 31st December 2025, the accounting records revealed the following:

- Share of profit: $\text{₦}420,000$
- Interest on capital: $\text{₦}60,000$
- Annual partner salary: $\text{₦}180,000$
- Cash drawings: $\text{₦}250,000$
- Interest on drawings: $\text{₦}10,000$

What is the balance of Ubong's current account as at 31st December 2025?

Chief Emeka dispatched goods to Kwame to be sold on his behalf on a consignment basis. At the end of the trading period, Kwame sent a statement detailing the gross sales realized, expenses incurred, commission earned, and net balance due to Chief Emeka. Which document was prepared and sent by Kwame?

A sample of gas enclosed in a vessel has a density of $0.90\text{ kg/m}^3$ and exerts a pressure of $3.0 \times 10^5\text{ N/m}^2$ on the walls of the vessel. Based on the kinetic theory of gases, what is the root-mean-square (r.m.s.) speed of the gas molecules in $\text{m/s}$?

Match each Nigerian geographical zone and its associated soil group on the left with the targeted soil conservation and management strategy used to mitigate its primary degradation threat on the right.

Calabar Crafts Limited operates two departments: Spinning and Garment. The Spinning Department transfers yarn to the Garment Department at cost plus a mark-up of $25\%$. At the end of the accounting period, the Garment Department holds closing inventory valued at $\text{N}40,000$, which includes $\text{N}30,000$ worth of yarn transferred from the Spinning Department. What is the amount of provision for unrealized profit to be debited to the General Profit and Loss Account?

Kano Retail Outlets acquired office furniture costing $₦1,500,000$ on 1 January 2024. Depreciation is charged at $10\%$ per annum using the straight-line method. What is the accumulated balance in the Provision for Depreciation on Furniture Account as of 31 December 2025?

Kano Electronics Enterprise operates two departments: Department A and Department B. For the accounting year ended 31 December 2025, the total sales turnover for the business was ₦500,000, of which Department A generated ₦300,000 and Department B generated ₦200,000. Total advertising expenses of ₦50,000 were incurred and are to be apportioned between the two departments on the basis of sales turnover. What is the amount of advertising expense apportioned to Department A?

Kano Outfitters operates two selling divisions: Men's Wear and Women's Wear. For the financial year ended 31 December 2025, the following departmental financial information is available:

Total joint expenses incurred during the year were:
- Rent and rates: ₦36,000 (apportioned based on floor space occupied: Men's Wear = 600 sq. m; Women's Wear = 400 sq. m)
- Salaries and wages: ₦50,000 (apportioned based on staff count: Men's Wear = 12 employees; Women's Wear = 8 employees)
- Direct advertising expense for Men's Wear: ₦8,400

What is the net profit of the Men's Wear division?

Tunde and Zainab established a commercial partnership on 1st January 2025 without executing a formal partnership deed. Tunde contributed $₦8,000,000$ and Zainab contributed $₦4,000,000$ as capital. On 1st July 2025, Zainab advanced an additional loan of $₦2,000,000$ to the firm. For the financial year ended 31st December 2025, the profit before accounting for loan interest was $₦3,850,000$. Under the provisions of the Partnership Act 1890, what is Zainab's share of the residual profit in Naira ($₦$)?

Sterling Logistics Plc forfeited $1,000$ ordinary shares of $₦1.00$ nominal value each for non-payment of a call of $���0.30$ per share, after $₦0.75$ per share had been called up. The shareholder had paid $₦0.45$ per share prior to forfeiture. The shares were subsequently re-issued as fully paid for $₦0.80$ per share. What amount should be credited to the Capital Reserve Account upon re-issue?

A business enterprise purchased office equipment for $₦500,000$ five years ago. Although the current market value of the equipment has appreciated to $₦800,000$, the accountant continues to record the asset at its original purchase cost in the financial statements. Which accounting concept or convention justifies this treatment?

Zenith Ventures Plc forfeited $800$ ordinary shares of $₦1.00$ nominal value each, called up to $₦0.80$ per share, due to non-payment of the first call of $₦0.30$ per share. Prior to forfeiture, the shareholder had paid $₦0.50$ per share. All $800$ forfeited shares were subsequently re-issued to a new investor as fully paid up for $��0.60$ per share. What is the net amount, in Naira ($₦$), to be credited to the Capital Reserve Account?

Kemi and Emeka are partners in a firm sharing profits and losses in the ratio of $3:2$. The profits of the firm for the past four years were $\text{N}180,000$, $\text{N}220,000$, $\text{N}240,000$, and $\text{N}200,000$ respectively. The capital employed in the firm is $\text{N}1,200,000$, and the normal rate of return expected on capital employed in this industry is $12\%$. Goodwill is valued at $3$ years' purchase of the super profit. Fola is admitted as a new partner for a $\frac{1}{6}$ share in profits, with the new profit-sharing ratio agreed as $3:2:1$. If goodwill is adjusted through the capital accounts without opening a goodwill account, what is the net credit amount (in Naira) to Emeka's capital account for goodwill?

Alhaji Farouk, a building materials merchant in Kano, maintains incomplete accounting records. The following ledger details were extracted regarding his trade creditors for the year ended 31 December 2025:

- Creditors balance at 1 January 2025: ₦45,000
- Cash payments to suppliers: ₦182,000
- Cheque payments to suppliers: ₦95,000
- Discount received from suppliers: ₦6,500
- Returns outwards: ₦4,800
- Contra set-off between sales and purchases ledgers: ₦3,200
- Refund received in cash from supplier for overpayment: ₦1,500
- Creditors balance at 31 December 2025: ₦52,000

What is the total amount of credit purchases for the year?

Kemi & Sons Enterprises operates three departments: Department X, Department Y, and Department Z. For the year ended 31st December 2025, the business incurred a total electricity bill of $₦240,000$. The electricity expense is to be apportioned among the departments based on the number of light points installed in each department. Department X has 15 light points, Department Y has 25 light points, and Department Z has 20 light points. What is the amount of electricity expense to be apportioned to Department Y?

During year-end preparation, a firm using a manual bookkeeping setup spends several days balancing individual ledger accounts before extracting a trial balance. How does a computerized accounting system alter this specific processing workflow compared to the manual system?

A sole trader extracted a trial balance on 31st December 2025 showing a total payment of $\text{N}320,000$ under the account heading 'Rent and Rates'.

Additional audit records reveal the following details:
1. The 'Rent and Rates' figure includes $\text{N}60,000$ paid specifically for rates.
2. On 1st January 2025, rent accrued brought forward was $\text{N}25,000$, and rent prepaid brought forward was $\text{N}40,000$.
3. On 31st December 2025, rent prepaid carried forward for the next financial year was $\text{N}35,000$, while rent accrued for 2025 was $\text{N}30,000$.

What is the net amount to be charged to the Profit and Loss Account for Rent Expense (excluding rates) for the year ended 31st December 2025?

Match each goodwill scenario or valuation method in partnership accounting on the left with its corresponding accounting treatment or formula on the right.

On 1st January 2026, Bamidele Enterprises recorded a credit balance of $\text{N}215,000$ in its Purchases Ledger Control Account. During the year ended 31st December 2026, credit purchases amounted to $\text{N}480,000$, payments to trade creditors by bank were $\text{N}410,000$, returns outwards totaled $\text{N}25,000$, and discount received was $\text{N}18,000$. Additionally, a contra entry of $\text{N}32,000$ was agreed to set off accounts between the sales ledger and purchases ledger. What is the closing credit balance of the Purchases Ledger Control Account as at 31st December 2026?