All practice questions

Meridian Marine Plc has an issued share capital of $1,600,000$ ordinary shares of $\text{₦}0.50$ each. The board of directors resolves to make a rights issue of $1$ new ordinary share for every $4$ shares held at an issue price of $\text{₦}0.80$ per share. If all shareholders exercise their rights in full, what is the total amount that will be credited to the Share Premium account from this transaction?

Kano Industrial Processing Ltd provides the following figures extracted from its books for the financial year ended 31 December 2025:

- Raw materials inventory (1 January 2025): $₦45,000$
- Purchases of raw materials: $₦220,000$
- Carriage inwards on raw materials: $₦12,000$
- Returns outwards of raw materials: $₦8,000$
- Raw materials inventory (31 December 2025): $₦35,000$
- Direct wages paid: $₦150,000$ (with $₦10,000$ accrued at year-end)
- Direct factory expenses: $₦25,000$
- Factory power and lighting paid: $₦40,000$ (includes $₦4,000$ prepaid for 2026)
- Factory supervisor's salary: $₦65,000$
- Depreciation of factory plant and machinery: $₦30,000$
- Work-in-progress inventory (1 January 2025): $₦28,000$
- Work-in-progress inventory (31 December 2025): $₦34,000$

What is the total Cost of Production transferred to the Trading Account for the year ended 31 December 2025?

Fatima dispatched $800$ cartons of cosmetics costing $\text{₦}10,000$ per carton to Ngozi on consignment. Fatima paid freight and insurance of $\text{₦}400,000$. Ngozi incurred carriage inwards of $\text{₦}160,000$, godown rent of $\text{₦}100,000$, and selling expenses of $\text{₦}200,000$. At the end of the period, Ngozi reported that $200$ cartons remained unsold. What is the value of the unsold consignment stock?

Under conceptual accounting frameworks, comparability is classified as a fundamental qualitative characteristic of accounting information.

Emeka consigned $100$ crates of fruit juice costing $\text{₦}4,000$ per crate to Nkechi. Emeka paid carriage charges of $\text{₦}20,000$. Nkechi received the consignment and paid godown rent of $\text{₦}10,000$ and selling expenses of $\text{₦}15,000$. If $20$ crates remained unsold at the end of the period, what is the value of the unsold consignment stock?

Statutory auditing is conducted by internal accountants of an organization to provide routine operational feedback and budget control recommendations directly to department managers.

Match each bank reconciliation item on the left to its correct accounting treatment on the right.

Tunde consigned 500 packages of merchandise to Emeka to sell on commission. The commission terms agreed upon in the consignment contract are as follows:
- Ordinary Commission: $5\%$ on total gross sales.
- Del-Credere Commission: $2.5\%$ on credit sales.
- Overriding Commission: $10\%$ on any excess selling price realized above the benchmark price of $\text{₦}1,800$ per package.

During the trading period, Emeka reported the following sales transactions:
- $200$ packages sold for cash at $\text{₦}2,000$ per package.
- $150$ packages sold on credit at $\text{₦}2,200$ per package.
- $50$ packages sold for cash at $\text{₦}1,800$ per package.

What is the total commission earned by Emeka in Naira ($\text{₦}$)?

During the financial year ended 31 December 2025, Maritime Workers Social Club received $\text{N}150,000$ in cash as subscriptions from its members. At 1 January 2025, subscriptions owing by members amounted to $\text{N}12,000$, while subscriptions paid in advance were $\text{N}8,000$. At 31 December 2025, subscriptions owing by members were $\text{N}15,000$, and subscriptions paid in advance amounted to $\text{N}10,000$. What amount should be credited to the Income and Expenditure Account as subscription income for the year ended 31 December 2025?

Alhaji Bello operates a boutique in Kano and maintains single-entry accounting records. For the financial year ended 31st December 2025, the following details were extracted from his records:

- Opening inventory: $₦38,000$
- Purchases: $₦280,000$
- Carriage inwards: $₦14,000$
- Returns outwards: $₦12,000$
- Goods withdrawn for personal use (at cost): $₦8,000$
- Closing inventory physically counted: $₦42,000$

If Alhaji Bello sells all goods at a uniform mark-up of $25\%$ on cost, what is his total sales revenue (in $₦$) for the year?

Premier Logistics Plc had an issued share capital of $2,000,000$ ordinary shares of $\text{₦}1.00$ each, a Share Premium account balance of $\text{₦}350,000$, and a General Reserve balance of $\text{₦}450,000$. The company first made a bonus issue of 1 new share for every 4 ordinary shares held, utilizing the Share Premium account to the maximum extent permissible before drawing from the General Reserve. Immediately following the bonus issue, the company declared a rights issue of 1 share for every 5 shares held at an issue price of $\text{₦}1.40$ per share. If all rights shares were fully subscribed and paid for, what is the final balance in the Share Premium account (in $\text{₦}$)?

Match each branch accounting characteristic or operational procedure on the left with its corresponding branch classification and accounting treatment on the right.

Match each accounting item or term related to the transfer of finished goods at market value with its corresponding accounting treatment or definition.

The following extract was taken from the trial balance of a sole trader as at 31st December 2025:

Additional Information:
1. On 1st July 2025, new machinery costing $\text{₦}200,000$ was purchased on credit and mistakenly entered in the Purchases Journal.
2. Depreciation is to be charged on machinery at $20\%$ per annum using the reducing balance method, calculated on a pro-rata basis for additions during the year.

What is the Net Book Value of Machinery to be shown in the Statement of Financial Position as at 31st December 2025?

Unlike a dependent branch, an independent branch maintains its own complete set of accounting records and extracts a trial balance at the end of the financial period.

Folake Enterprises consigned goods to Audu. During the trading period, Audu generated cash sales of ₦400,000 and credit sales of ₦600,000. A credit customer defaulted, resulting in bad debts of ₦30,000. Under the terms of the agreement, Audu receives an ordinary commission of 5% on total sales and a del-credere commission of 3% on credit sales. If Audu also incurred selling expenses of ₦20,000, what is the net amount payable by Audu to Folake Enterprises?

Bello Traders operates a business with incomplete records. The following details were extracted from the business records for the year ended 31 December 2025:

Calculate the total sales for the year ended 31 December 2025.

Danladi Manufacturing Plc forfeited $2,500$ ordinary shares of $₦1.00$ nominal value each due to non-payment of the final call of $₦0.30$ per share. All of the forfeited shares were subsequently reissued to a new subscriber as fully paid at $₦0.80$ per share. What is the net amount (in $₦$) transferred to the Capital Reserve account?

Which of the following security measures is primarily designed to monitor and block unauthorized network traffic from gaining remote access to a firm's computerized accounting database?

Nova Crest Logistics Plc issued $90,000$ ordinary shares of $\text{₦}3.00$ nominal value each at a discount of $5\%$. Assuming all shares were fully subscribed and paid for, what is the total net cash amount, in $\text{₦}$, received by the company from this share issue?