Tüm alıştırma soruları

Soru 1281Soru →

A sole trader who maintains incomplete accounting records presents the following financial summary for the year ended 31st December 2025:

- Opening Capital: $\text{₦}150,000$
- Additional Capital Introduced: $\text{₦}30,000$
- Drawings during the year: $\text{₦}20,000$
- Closing Capital: $\text{₦}210,000$

What is the net profit of the business for the year in Naira ( $\text{₦}$ )?

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Cevap: 50000

Cevap

The net profit for the year is ₦50,000.

Under the statement of affairs (capital comparison) method, profit is calculated by adding drawings back to the closing capital and deducting both the additional capital introduced and the opening capital:

\text{₦}210,000 + \text{₦}20,000 - \text{₦}30,000 - \text{₦}150,000 = \text{₦}50,000

.

Adım Adım Çözüm

1

Identify the formula for determining net profit under incomplete records using the capital comparison method.

\text{Net Profit} = \text{Closing Capital} + \text{Drawings} - \text{Additional Capital} - \text{Opening Capital}

Drawings reduce capital and must be added back to find true earned profit, while additional capital increases equity without coming from trading performance and must be deducted.

2

Insert the given amounts into the formula.

\text{Net Profit} = \text{₦}210,000 + \text{₦}20,000 - \text{₦}30,000 - \text{₦}150,000

To isolate the profit generated purely from business operations during the year.

3

Perform the calculation.

\text{Net Profit} = \text{₦}50,000

\text{₦}230,000

total adjusted closing capital minus

\text{₦}180,000

total adjusted starting capital yields

\text{₦}50,000

net profit.

Anahtar Kavram

Statement of Affairs Method (Capital Comparison)

Tahmini Süre:1m 0s

Soru 1282Soru →

Sahara Energy Works Plc extracted the following trial balance figures and notes for the financial year ended 31 December 2025:

- Gross profit: ₦2,450,000
- Administrative and distribution expenses paid: ₦680,000
- 10% Debentures (issued 1 January 2025): ₦1,000,000
- Debenture interest paid: ₦40,000
- Trade debtors: ₦600,000
- Existing provision for doubtful debts: ₦25,000

Additional Information at 31 December 2025:
1. Administrative expenses paid include ₦30,000 for prepaid insurance.
2. Audit fees of ₦50,000 remain accrued and unpaid.
3. The provision for doubtful debts is to be adjusted to $5\%$ of trade debtors.
4. Corporate income tax rate is estimated at $30\%$ on profit before tax.

What is the Net Profit after Tax for Sahara Energy Works Plc for the year ended 31 December 2025?

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Cevap: 1151500

Cevap

The Net Profit after Tax for Sahara Energy Works Plc is ��1,151,500.

To calculate the Net Profit after Tax, first compute adjusted operating expenses: base expenses of ₦680,000 minus prepaid insurance of ₦30,000 plus accrued audit fees of ₦50,000 plus the increase in doubtful debts provision of ₦5,000 (₦30,000 required minus ₦25,000 existing), yielding ₦705,000. Subtracting this from Gross Profit (₦2,450,000) gives Operating Profit of ₦1,745,000. Next, deduct the total annual debenture interest expense of ₦100,000 (10% of ₦1,000,000) to arrive at Profit before Tax of ₦1,645,000. Finally, deduct corporate tax of 30% (₦493,500) from ₦1,645,000 to obtain Net Profit after Tax equal to ₦1,151,500.

Adım Adım Çözüm

1

Calculate the total operating expenses incorporating adjustments for prepayments, accruals, and doubtful debt provisions.

Total operating expenses = ₦680,000 - ₦30,000 + ₦50,000 + (5% of ₦600,000 - ₦25,000) = ₦705,000.

Prepaid expenses are deducted from cash paid, accrued expenses are added, and the increase in provision for doubtful debts (₦30,000 - ₦25,000 = ₦5,000) is charged as an operating expense.

2

Deduct operating expenses from gross profit to find operating profit (profit before interest and tax).

Operating profit = ₦2,450,000 - ₦705,000 = ₦1,745,000.

Gross profit less total operating expenses yields the operating profit for the reporting period.

3

Determine full finance cost (debenture interest) and profit before taxation.

Debenture interest expense = 10% of ₦1,000,000 = ₦100,000. Profit before tax = ₦1,745,000 - ₦100,000 = ₦1,645,000.

The Statement of Profit or Loss must charge the full nominal debenture interest expense incurred for the year (

10\% \times ₦1,000,000 = ₦100,000

), regardless of the amount actually paid (₦40,000).

4

Calculate taxation and determine Net Profit after Tax.

Taxation = 30% of ₦1,645,000 = ₦493,500. Net profit after tax = ₦1,645,000 - ₦493,500 = ₦1,151,500.

Tax rate applies to profit before tax. Deducting taxation from profit before tax yields the final net profit after tax.

Anahtar Kavram

Preparation of Company Statement of Profit or Loss with Multi-Step Adjustments (Accruals, Prepayments, Debenture Interest, and Taxation)

Soru 1283Soru →

As at 31 December 2025, Adeola Trading Enterprise had Trade Debtors of $₦450,000$ and an existing Provision for Doubtful Debts of $₦15,000$ . At year-end, an additional bad debt of $₦20,000$ is to be written off, and the provision for doubtful debts is to be adjusted to $5\%$ of the remaining trade debtors. What is the net amount of trade debtors to be presented under Current Assets in the Statement of Financial Position as at 31 December 2025?

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Cevap: 408500

Cevap

The net amount of trade debtors to be presented under Current Assets in the Statement of Financial Position is ₦408,500.

To determine the net trade debtors for the Statement of Financial Position, first subtract the additional bad debts of ₦20,000 from gross debtors of ₦450,000, leaving ₦430,000. Next, calculate the closing provision of 5% on ₦430,000, which equals ₦21,500. Subtracting the ₦21,500 provision from ₦430,000 gives ₦408,500 as the net trade debtors figure.

Adım Adım Çözüm

1

Deduct additional bad debts from gross trade debtors

Adjusted Debtors = ₦450,000 - ₦20,000 = ₦430,000

Bad debts identified at year-end must be written off from trade debtors before computing the provision for doubtful debts.

2

Calculate the required closing provision for doubtful debts

Closing Provision = 5% of ₦430,000 = ₦21,500

The percentage provision for doubtful debts applies strictly to net trade debtors after writing off bad debts.

3

Calculate net trade debtors for Statement of Financial Position presentation

Net Trade Debtors = ₦430,000 - ₦21,500 = ₦408,500

Trade debtors are shown in the balance sheet net of the closing provision for doubtful debts.

Anahtar Kavram

Calculation of Net Trade Debtors for Balance Sheet presentation after adjustments for bad debts and provision for doubtful debts.

Soru 1284Soru →

A head office transfers goods to its dependent branch at an invoice price loaded at a mark-up of $25\%$ on cost. During the financial period, goods sent to the branch amounted to $\text{₦}200,000$ at invoice price, while goods returned by the branch to the head office at invoice price totaled $\text{₦}16,000$ . What is the total profit load (unrealized profit element) contained in the net goods sent to the branch?

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Cevap: 36800

Cevap

The total profit load contained in the net goods sent to the branch is ₦36,800.

To find the unrealized profit loading on net goods sent, subtract returns (₦16,000) from total goods sent (₦200,000) to get net goods sent of ₦184,000 at invoice price. A 25% mark-up on cost corresponds to a 20% margin on invoice price (1/5th). Calculating 20% of ₦184,000 yields ₦36,800.

Adım Adım Çözüm

1

Calculate net goods sent to the branch at invoice price

₦184,000

Returns to head office must be deducted from gross transfers to determine net goods received by the branch.

2

Convert mark-up on cost to margin on invoice price

20% (or 1/5)

Since invoice price is cost plus mark-up, a mark-up of 25% on cost translates to 20% on invoice price.

3

Calculate the profit element (loading)

₦36,800

Multiply the margin fraction (1/5) by the net invoice price (₦184,000).

Anahtar Kavram

Accounting for Dependent Branches at Selling / Invoice Price

Soru 1285Soru →

The following financial positions were extracted from the books of Lakeside Recreation Association as at 1st January 2025:

Item	Amount (₦)
Clubhouse premises	1,200,000
Equipment and furniture	650,000
Cash at bank	180,000
Bar inventory	45,000
Subscriptions due but unpaid	35,000
Subscriptions received in advance	20,000
Outstanding electricity bill	15,000
Bar creditors	25,000

What is the Accumulated Fund of the association as at 1st January 2025 in Naira (₦)?

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Cevap: 2050000

Cevap

The Accumulated Fund of Lakeside Recreation Association as at 1st January 2025 is ₦2,050,000.

The Accumulated Fund is calculated by subtracting total liabilities from total assets at the start of the financial period. Adding the assets gives: Clubhouse premises (₦1,200,000) + Equipment and furniture (₦650,000) + Cash at bank (₦180,000) + Bar inventory (₦45,000) + Subscriptions due but unpaid (₦35,000) = ₦2,110,000. Summing the liabilities gives: Subscriptions received in advance (₦20,000) + Outstanding electricity bill (₦15,000) + Bar creditors (₦25,000) = ₦60,000. Subtracting liabilities from assets yields ₦2,110,000 - ₦60,000 = ₦2,050,000.

Adım Adım Çözüm

1

Calculate Total Assets as at 1st January 2025

��2,110,000

Total assets comprise non-current assets (premises, equipment/furniture), current assets (cash at bank, bar inventory), and accrued income (subscriptions due but unpaid).

2

Calculate Total Liabilities as at 1st January 2025

₦60,000

Total liabilities comprise prepaid income (subscriptions received in advance), accrued expenses (outstanding electricity bill), and payables (bar creditors).

3

Deduct Total Liabilities from Total Assets to determine the Accumulated Fund

₦2,050,000

The Accumulated Fund represents the opening capital surplus of a non-profit entity, calculated using the accounting equation: Accumulated Fund = Total Assets - Total Liabilities.

Anahtar Kavram

Calculation of Accumulated Fund for Non-Profit Organizations

Soru 1286Soru →

Ade and Ngozi are partners in an engineering firm sharing profits and losses in the ratio of $3:2$ . Their capital account balances prior to the admission of a new partner, Emeka, are $\text{₦}120,000$ and $\text{₦}80,000$ respectively. Upon Emeka's admission, the partnership assets are revalued, yielding a net revaluation profit of $\text{₦}30,000$ . What is the adjusted capital balance of Ade in Naira after crediting his share of the revaluation profit?

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Cevap: 138000

Cevap

Ade's adjusted capital balance after crediting the revaluation profit is 138,000 Naira.

When a new partner is admitted, any gain resulting from the revaluation of existing assets and liabilities belongs strictly to the existing partners and must be shared in their old profit and loss sharing ratio (

3:2

). Ade's fraction of the profit is

\frac{3}{5} \times \text{₦}30,000 = \text{₦}18,000

. Adding this profit to Ade's initial capital balance of

\text{₦}120,000

yields an adjusted balance of

\text{₦}138,000

.

Adım Adım Çözüm

1

Calculate the total parts in the old profit-sharing ratio

3 + 2 = 5 parts

Revaluation gains and losses occurring prior to the admission of a new partner belong entirely to existing partners in their old profit-sharing ratio.

2

Calculate Ade's share of the net revaluation profit

(3 / 5) * 30,000 = 18,000 Naira

Ade receives 3 out of the 5 total ratio parts of the 30,000 Naira revaluation profit.

3

Calculate Ade's new capital account balance

120,000 + 18,000 = 138,000 Naira

A revaluation profit increases the existing partner's capital balance and is credited to their capital account.

Anahtar Kavram

Allocation of Revaluation Gain on Admission of a Partner

Soru 1287Soru →

Zainab Traders dispatched $1,200$ crates of industrial lubricants costing $\text{₦}8,000$ per crate on consignment to Aliyu & Sons. Zainab Traders paid $\text{₦}480,000$ for freight and $\text{₦}120,000$ for transit insurance. Aliyu & Sons paid $\text{₦}240,000$ for clearing charges, $\text{₦}180,000$ for godown rent, and $\text{₦}300,000$ for sales commission. If $900$ crates were sold by the end of the accounting period, what is the total value of the unsold consignment stock in Naira ( $\text{₦}$ )?

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Cevap: 2610000

Cevap

The total value of the unsold consignment stock is ₦2,610,000.

The correct total value of unsold consignment stock is ₦2,610,000. This comprises the basic cost of 300 unsold crates (₦2,400,000), proportionate consignor non-recurring expenses of freight and insurance (₦150,000), and proportionate consignee non-recurring clearing charges (₦60,000). Recurring expenses (godown rent and commission) are omitted.

Adım Adım Çözüm

1

Determine the number of unsold crates and compute their basic cost price.

Unsold quantity = 300 crates; Basic cost = ₦2,400,000

Unsold stock is measured as the difference between total consigned quantity (1,200 crates) and sold quantity (900 crates), multiplied by the unit cost (₦8,000).

2

Add the proportionate share of consignor's direct (non-recurring) expenses.

Proportionate consignor expenses = ₦150,000

Freight (₦480,000) and transit insurance (₦120,000) are incurred to bring goods to their destination and must be apportioned to unsold units (1/4 × ₦600,000 = ₦150,000).

3

Add the proportionate share of consignee's direct (non-recurring) expenses while excluding recurring expenses.

Proportionate consignee direct expenses = ₦60,000

Clearing charges (₦240,000) are direct non-recurring costs (1/4 × ₦240,000 = ₦60,000). Recurring expenses such as godown rent and sales commission are excluded from stock valuation.

4

Sum basic cost, consignor proportionate expenses, and consignee direct proportionate expenses.

Total unsold stock valuation = ₦2,610,000

Consignment stock is valued at cost plus all proportionate non-recurring expenses incurred up to the point of reaching the consignee's warehouse.

Anahtar Kavram

Valuation and Accounting Treatment of Unsold Consignment Stock

Tahmini Süre:2m 0s

Soru 1288Soru →

Oceanic Commerce Plc earned a gross profit of ₦1,200,000 for the financial year ended 31 December 2025. During the year, the company incurred total administrative and distribution expenses of ₦450,000 and paid ₦50,000 as interest on debentures. Calculate the net profit before taxation for the year in Naira (₦).

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Cevap: 700000

Cevap

The net profit before taxation for the year is ₦700,000.

Net profit before taxation is derived by taking the gross profit of ₦1,200,000 and deducting both operating expenses (₦450,000) and debenture interest (₦50,000), leaving a net profit before tax of ₦700,000.

Adım Adım Çözüm

1

Calculate operating profit by deducting administrative and distribution expenses from gross profit.

₦1,200,000 - ₦450,000 = ₦750,000

Operating profit measures earnings from core operations before finance expenses.

2

Deduct debenture interest from operating profit to arrive at net profit before tax.

₦750,000 - ₦50,000 = ₦700,000

Debenture interest is a mandatory finance cost charged against profit in the Statement of Profit or Loss.

Anahtar Kavram

Net Profit Determination in Company Statement of Profit or Loss

Tahmini Süre:1m 0s

Soru 1289Soru →

On 31st October 2026, the Cash Book of Chidiebere Enterprises showed an unadjusted debit balance of $\text{NGN } 54,200$ . Upon comparing the Cash Book with the bank statement, the following items were identified: a direct credit from a customer of $\text{NGN } 11,500$ , bank charges of $\text{NGN } 2,800$ , a standing order payment for insurance of $\text{NGN } 6,400$ , and a customer's dishonoured cheque of $\text{NGN } 4,500$ (none of which were previously recorded in the Cash Book). Furthermore, unpresented cheques amounted to $\text{NGN } 18,300$ and uncredited lodgements totaled $\text{NGN } 14,100$ . What is the balance as per the bank statement on 31st October 2026 in NGN?

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Cevap: 56200

Cevap

The balance as per the bank statement on 31st October 2026 is NGN 56,200.

The adjusted cash book balance is calculated by starting with NGN 54,200, adding the direct credit of NGN 11,500, and deducting bank charges of NGN 2,800, standing order of NGN 6,400, and dishonoured cheque of NGN 4,500, which yields an adjusted cash book balance of NGN 52,000. Reconciling to the bank statement requires adding unpresented cheques of NGN 18,300 and subtracting uncredited lodgements of NGN 14,100, resulting in a final bank statement balance of NGN 56,200.

Adım Adım Çözüm

1

Calculate the adjusted balance of the Cash Book

Adjusted Cash Book Balance = NGN 52,000

Direct credits increase the cash book balance, while bank charges, standing orders, and dishonoured cheques decrease the cash book balance.

2

Reconcile the adjusted cash book balance to arrive at the bank statement balance

Bank Statement Balance = NGN 56,200

Adding unpresented cheques (cheques drawn but not yet presented at bank) and subtracting uncredited lodgements (cheques deposited but not yet credited by bank) converts the adjusted cash book balance to the balance per bank statement.

Anahtar Kavram

Preparation of Adjusted Cash Book and Bank Reconciliation Statement

Soru 1290Soru →

At 31st December 2025, the trial balance of Danjuma Trading Enterprise showed Trade Receivables of $\text{₦}160,000$ and an existing Provision for Doubtful Debts of $\text{₦}6,400$ .

Additional information:
1. Additional bad debts of $\text{₦}10,000$ are to be written off.
2. A specific debt of $\text{₦}4,000$ is identified as doubtful and requires a 100% provision.
3. A general provision for doubtful debts is to be set at $5\%$ of the remaining trade receivables.

What is the net amount (in $\text{₦}$ ) to be charged to the Income Statement (Profit and Loss Account) for provision for doubtful debts for the year ended 31st December 2025?

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Cevap: 4900

Cevap

The net amount to be charged to the Income Statement for provision for doubtful debts is

\text{₦}4,900

.

To determine the expense charge to the Income Statement, first calculate net receivables after bad debts:

\text{₦}160,000 - \text{₦}10,000 = \text{₦}150,000

. Subtract the specific doubtful debt of

\text{₦}4,000

to get general receivables of

\text{₦}146,000

. The general provision is

5\% \times \text{₦}146,000 = \text{₦}7,300

. Adding the specific provision of

\text{₦}4,000

gives a total ending provision of

\text{₦}11,300

. Subtracting the opening provision of

\text{₦}6,400

yields a net increase of

\text{₦}4,900

, which is charged to the Income Statement.

Adım Adım Çözüm

1

Calculate adjusted trade receivables after writing off additional bad debts.

Adjusted receivables =

\text{₦}160,000 - \text{₦}10,000 = \text{₦}150,000

.

Bad debts written off at year-end reduce gross trade receivables before calculating the new provision.

2

Deduct specific doubtful debt to arrive at general trade receivables.

General trade receivables =

\text{₦}150,000 - \text{₦}4,000 = \text{₦}146,000

.

Specific doubtful debts are provided for separately and excluded before applying the general percentage rate.

3

Calculate total new provision required at the end of the year.

Total provision =

\text{₦}4,000 \text{ (specific)} + (5\% \times \text{₦}146,000) = \text{₦}4,000 + \text{₦}7,300 = \text{₦}11,300

.

The closing provision balance consists of both the specific provision and the general provision.

4

Calculate the net increase in provision to be charged as an expense in the Income Statement.

Net increase =

\text{₦}11,300 - \text{₦}6,400 = \text{₦}4,900

.

Only the difference between the required closing provision and the opening provision balance is recognized in the Income Statement.

Anahtar Kavram

Creation and Adjustment of Provision for Doubtful Debts

Soru 1291Soru →

The ledger of Tunde & Co. shows a Trade Debtors balance of $\text{₦}120,000$ at the end of the accounting period. Additional information reveals that bad debts of $\text{₦}5,000$ are to be written off, a Provision for Doubtful Debts is to be maintained at $5\%$ on net debtors, and a Provision for Discount on Debtors is to be created at $2\%$ . What is the amount of the new Provision for Discount on Debtors to be created?

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Cevap: 2185

Cevap

The amount of the new Provision for Discount on Debtors is

\text{₦}2,185

.

The provision for discount on debtors must be calculated on good debtors. Starting with gross debtors of

\text{₦}120,000

, subtracting bad debts of

\text{₦}5,000

leaves

\text{₦}115,000

. Deducting the

5\%

provision for doubtful debts (

\text{₦}5,750

) gives net good debtors of

\text{₦}109,250

. Applying

2\%

to

\text{₦}109,250

results in

\text{₦}2,185

.

Adım Adım Çözüm

1

Deduct bad debts written off from gross trade debtors

Net debtors before provision =

\text{₦}120,000 - \text{₦}5,000 = \text{��}115,000

Bad debts are irrecoverable and must be removed from trade debtors before calculating provisions.

2

Calculate the Provision for Doubtful Debts

Provision for Doubtful Debts =

5\% \times \text{₦}115,000 = \text{₦}5,750

Provision for doubtful debts is based on net debtors after bad debts are written off.

3

Deduct provision for doubtful debts to determine eligible good debtors

Eligible debtors balance =

\text{₦}115,000 - \text{₦}5,750 = \text{₦}109,250

Discounts are only estimated for good debtors who are expected to pay promptly, excluding doubtful accounts.

4

Calculate the Provision for Discount on Debtors

Provision for Discount on Debtors =

2\% \times \text{₦}109,250 = \text{₦}2,185

Apply the discount rate to the net eligible debtors balance.

Anahtar Kavram

Calculation Sequence for Provision for Discount on Debtors

Soru 1292Soru →

A retail enterprise operating without full double-entry bookkeeping records provides the following financial details for the year ended 31 December 2025:

- Trade debtors balance on 1 January 2025: $\text{₦}45,000$
- Trade debtors balance on 31 December 2025: $\text{₦}58,000$
- Cash received from debtors deposited into bank: $\text{₦}420,000$
- Cash discounts granted to customers: $\text{₦}2,500$
- Irrecoverable debts written off: $\text{₦}3,500$
- Sales returns from credit customers: $\text{₦}4,000$
- Contra set-off settlement against creditors ledger: $\text{��}6,000$
- Dishonoured cheques from credit customers: $\text{₦}5,000$
- Cash sales paid directly into the bank account: $\text{₦}85,000$
- Cash sales withdrawn by the owner for personal use before banking: $\text{₦}12,000$

What is the total value of sales (in $\text{₦}$ ) for the enterprise during the year?

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Cevap: 540500

Cevap

The total value of sales for the business for the year is

\text{₦}540,500

.

To find total sales when converting incomplete records, a Debtors Control Account must be constructed to calculate credit sales, and total cash sales must be added. Summing all credit items (

\text{₦}420,000 + \text{₦}2,500 + \text{₦}3,500 + \text{₦}4,000 + \text{₦}6,000 + \text{₦}58,000 = \text{₦}493,500

) and subtracting the known debits (

\text{₦}45,000

opening balance

+ \text{₦}5,000

dishonoured cheques) yields credit sales of

\text{₦}443,500

. Adding total cash sales (

\text{₦}85,000

banked

+ \text{₦}12,000

drawings

= \text{₦}97,000

) gives the final total sales of

\text{₦}540,500

.

Adım Adım Çözüm

1

Reconstruct the Sales Ledger Control Account (Debtors Account) to determine credit sales.

Credit items sum to

\text{₦}493,500

, while known debit items (opening debtors of

\text{₦}45,000

plus dishonoured cheques of

\text{₦}5,000

) sum to

\text{₦}50,000

.

Dishonoured cheques increase the debt owed by customers and must be debited to the control account, while discounts allowed, bad debts written off, sales returns, contra set-offs, cash received, and closing balances credit the account.

2

Calculate the derived Credit Sales figure.

\text{Credit Sales} = \text{₦}493,500 - \text{₦}50,000 = \text{₦}443,500

.

The missing debit balance in the control account represents total credit sales generated during the accounting period.

3

Compute the total Cash Sales.

\text{Total Cash Sales} = \text{₦}85,000 + \text{₦}12,000 = \text{₦}97,000

.

Cash sales include both the amount banked and cash takings appropriated by the owner prior to banking.

4

Calculate Total Sales.

\text{Total Sales} = \text{₦}443,500 + \text{₦}97,000 = \text{₦}540,500

.

Total turnover comprises all credit sales plus total cash sales.

Anahtar Kavram

Conversion from Single Entry to Double Entry - Determination of Total Sales via Debtors Control Account and Cash Summary

Tahmini Süre:2m 30s

Soru 1293Soru →

A head office invoices goods to its dependent branch at a selling price that includes a profit margin of $25\%$ on invoice price. At the end of the accounting year, the branch stock count shows closing inventory valued at $\text{₦}60,000$ at invoice price. What is the amount of stock reserve (unrealized profit) required to reduce the branch closing inventory to its cost price?

Cevabı ve açıklamayı göster

Cevap: 15000

Cevap

The amount of stock reserve required to reduce the closing stock to cost price is

\text{₦}15,000

.

When goods are invoiced at selling price with a known profit margin percentage on invoice price, the unrealized profit (stock reserve) contained in closing stock is computed by multiplying the margin percentage directly by the closing inventory at invoice price (

25\% \times \text{₦}60,000 = \text{₦}15,000

).

Adım Adım Çözüm

1

Determine the proportion of unrealized profit included in the invoice price.

Profit margin is

25\%

on invoice price, which equals

\frac{25}{100} = \frac{1}{4}

of the invoice price.

Since the rate is given as a margin on invoice price (selling price), the profit fraction is applied directly to the invoice value.

2

Calculate the stock reserve on the branch closing inventory.

\text{Stock Reserve} = \frac{1}{4} \times \text{₦}60,000 = \text{₦}15,000

.

The stock reserve represents the unrealized profit portion included in the unsold inventory at the end of the financial period.

Anahtar Kavram

Calculation of Stock Reserve on Branch Closing Stock at Invoice Price using Margin

Soru 1294Soru →

Zenith Manufacturing Enterprise extracted the following closing inventory figures and adjustment details at the end of its financial year:

- Raw materials inventory: ₦45,000
- Work-in-progress inventory: ₦28,000
- Finished goods inventory (at market transfer value): ₦75,000
- Provision for unrealized profit on closing finished goods: ₦15,000

What is the total value of manufacturing inventories (in Naira) to be presented under current assets in the Statement of Financial Position?

Cevabı ve açıklamayı göster

Cevap: 133000

Cevap

The total value of manufacturing inventories to be presented under current assets in the Statement of Financial Position is ₦133,000.

In the Statement of Financial Position of a manufacturing business, inventories are disclosed under current assets. Raw materials (₦45,000), work-in-progress (₦28,000), and finished goods are summed together. Finished goods transferred at market value must be stated at original prime/production cost by subtracting the provision for unrealized profit (₦75,000 - ₦15,000 = ₦60,000). Thus, total manufacturing inventories equal ₦45,000 + ₦28,000 + ₦60,000 = ₦133,000.

Adım Adım Çözüm

1

Deduct the provision for unrealized profit from finished goods inventory at transfer value.

Net finished goods inventory = ₦75,000 - ₦15,000 = ₦60,000.

Finished goods transferred at a market value above cost include an internal profit element, which must be eliminated via a provision for unrealized profit so that inventory is reported at original cost in the financial statements.

2

Sum all three categories of manufacturing inventory (Raw Materials, Work-in-Progress, and Net Finished Goods).

Total manufacturing inventories = ₦45,000 + ₦28,000 + ₦60,000 = ₦133,000.

All three forms of inventory are current assets and must be aggregated for total inventory presentation under current assets in the Statement of Financial Position.

Anahtar Kavram

Balance Sheet Presentation of Manufacturing Inventories and Provision for Unrealized Profit

Soru 1295Soru →

Kano Processing Company transfers all finished items from the factory to its sales unit at a price that includes a $20\%$ mark-up on factory cost. On 31st December 2025, the trading section held finished inventory valued at a transfer price of $\text{₦}48,000$ . What is the amount of provision for unrealized profit required for this closing inventory in Naira?

Cevabı ve açıklamayı göster

Cevap: 8000

Cevap

The provision for unrealized profit on the closing inventory is ₦8,000.

Converting the 20% mark-up on cost to a profit margin yields 1/6 of the transfer price. Applying 1/6 to the ₦48,000 closing inventory at transfer price gives ₦8,000.

Adım Adım Çözüm

1

Determine the profit fraction relative to the transfer price

Mark-up of 20% on cost equals a margin of 1/6 on transfer price

Since the closing inventory is recorded at transfer price, the profit element must be calculated as a proportion of the transfer price: Profit Margin = Markup / (1 + Markup) = 0.20 / 1.20 = 1/6.

2

Calculate the unrealized profit provision amount

₦8,000

Multiply the finished goods closing inventory at transfer price by the profit margin fraction: 1/6 * ₦48,000 = ₦8,000.

Anahtar Kavram

Calculation of Provision for Unrealized Profit on Closing Inventory using Mark-up to Margin conversion

Soru 1296Soru →

Ade, Bala, and Chukwu are partners in a firm sharing profits and losses in the ratio $4:3:1$ respectively. Bala decides to retire from the partnership. At the date of his retirement, his Capital Account has a credit balance of $\text{₦}250,000$ , while his Current Account has a debit balance of $\text{₦}20,000$ . The firm's goodwill is valued at $\text{₦}160,000$ , and the revaluation of assets and liabilities yields a net profit of $\text{₦}40,000$ . What is the total amount payable to Bala upon his retirement?

Cevabı ve açıklamayı göster

Cevap: 305000

Cevap

The total amount payable to Bala upon his retirement is ₦305,000.

The amount due to a retiring partner is computed by taking their capital credit balance (₦250,000), deducting any current account debit balance (₦20,000), and adding their share of goodwill (3/8 of ₦160,000 = ₦60,000) and share of revaluation profit (3/8 of ₦40,000 = ₦15,000). Thus, 250,000 - 20,000 + 60,000 + 15,000 = ₦305,000.

Adım Adım Çözüm

1

Determine the retiring partner's profit-sharing ratio

Bala's ratio is 3 out of total parts (4 + 3 + 1 = 8), which equals 3/8.

Adjustments for goodwill and revaluation must be shared among partners according to their existing profit-sharing ratio.

2

Calculate Bala's share of Goodwill

3/8 × ₦160,000 = ₦60,000

The retiring partner is entitled to their proportional share of the firm's total goodwill.

3

Calculate Bala's share of Revaluation Profit

3/8 × ₦40,000 = ₦15,000

Net gains arising from the revaluation of assets and liabilities are credited to all partners in their profit-sharing ratio.

4

Sum all credits and subtract debits to find the final settlement figure

₦250,000 (Capital Cr) - ₦20,000 (Current Dr) + ₦60,000 (Goodwill share) + ₦15,000 (Revaluation share) = ₦305,000

A credit balance on capital increases settlement value, a debit balance on current account reduces it, and shares of goodwill and revaluation profit are added.

Anahtar Kavram

Partnership Capital Account Settlement on Retirement

Alternatif Yöntem

Prepare Bala's Capital/Settlement Account by posting credits (Capital: ₦250,000, Goodwill: ₦60,000, Revaluation Profit: ₦15,000) on the credit side and debiting Current Account (₦20,000) on the debit side; the balancing figure on the debit side represents the amount transferred to Bala's Loan/Executor/Cash Settlement Account (₦305,000).

Tahmini Süre:1m 30s

Soru 1297Soru →

At 31st March 2026, the trial balance of Okonkwo Stores showed Trade Receivables of $\text{₦}250,000$ and an existing Provision for Doubtful Debts of $\text{₦}8,000$ . An additional bad debt of $\text{₦}10,000$ is to be written off, and the provision for doubtful debts is to be adjusted to $5\%$ of the remaining trade receivables. What is the net amount (in $\text{₦}$ ) to be charged as an expense to the Profit and Loss Account for provision for doubtful debts?

Cevabı ve açıklamayı göster

Cevap: 4000

Cevap

The net amount to be charged as an expense to the Profit and Loss Account for provision for doubtful debts is ₦4,000.

The net trade receivables after deducting the additional bad debt of ₦10,000 is ₦240,000. The required provision at 5% is ₦12,000. Comparing this with the existing provision balance of ₦8,000 gives an increase of ₦4,000, which is the amount charged as an expense to the Profit and Loss Account.

Adım Adım Çözüm

1

Calculate remaining trade receivables after writing off additional bad debts

₦250,000 - ₦10,000 = ₦240,000

Additional bad debts written off must be deducted from gross trade receivables before calculating the new provision.

2

Calculate the new required provision for doubtful debts

5% of ₦240,000 = ₦12,000

The provision percentage is applied to the net remaining trade receivables figure.

3

Determine the net adjustment required in the Income Statement

₦12,000 - ₦8,000 = ₦4,000

Only the increase in provision over the existing provision is charged as an expense to the Profit and Loss Account.

Anahtar Kavram

Calculation of Increase in Provision for Doubtful Debts after deducting additional bad debts written off

Soru 1298Soru →

A sole trader conducted a physical stock count at the end of the financial year and compiled the following information regarding three product lines of unsold goods:

Product Line	Total Cost (₦)	Estimated Selling Price (₦)	Selling / Modification Expenses (₦)
Product A	45,000	52,000	3,000
Product B	32,000	36,000	7,000
Product C	60,000	58,000	4,000

In accordance with the prudence concept, what is the total value of closing inventory (in ₦) to be presented in the final accounts?

Cevabı ve açıklamayı göster

Cevap: 128000

Cevap

The total value of closing inventory to be presented in the final accounts is ₦128,000.

Inventory must be valued item by item at the lower of cost and Net Realizable Value (NRV). Product A is valued at its cost of ₦45,000 (lower than NRV of ₦49,000). Product B is written down to its NRV of ₦29,000 (lower than cost of ₦32,000). Product C is written down to its NRV of ₦54,000 (lower than cost of ₦60,000). Summing these lower values yields ₦128,000.

Adım Adım Çözüm

1

Calculate Net Realizable Value (NRV) for each product line using NRV = Estimated Selling Price - Selling/Modification Expenses.

Product A NRV = ₦49,000; Product B NRV = ₦29,000; Product C NRV = ₦54,000.

Net Realizable Value reflects the net proceeds expected to be realized from the sale of inventory in the ordinary course of business.

2

Determine the lower of cost and NRV on an item-by-item basis.

Product A is valued at ₦45,000; Product B is valued at ₦29,000; Product C is valued at ₦54,000.

The prudence concept dictates that inventory should be valued at the lower of cost and net realizable value to avoid overstating assets and profits.

3

Sum the selected valuation amounts across all product lines.

Total inventory value = ₦45,000 + ₦29,000 + ₦54,000 = ₦128,000.

Summing the itemized values gives the overall figure to be credited to the Trading Account and shown under Current Assets in the Balance Sheet.

Anahtar Kavram

Valuation of inventory at the lower of cost and net realizable value (Prudence Concept)

Soru 1299Soru →

Abeokuta Head Office operates a dependent branch in Sagamu, supplying all goods at cost price. On 1 January 2025, the Branch Debtors Account had an opening balance of $\text{₦}15,000$ . During the year ended 31 December 2025, credit sales recorded by the branch were $\text{₦}68,000$ . Cash collected from debtors and remitted to the Head Office totaled $\text{��}54,000$ . Additional adjustments revealed discounts allowed to debtors of $\text{₦}2,000$ , bad debts written off of $\text{₦}1,000$ , and returns from debtors to the branch of $\text{₦}3,000$ . What is the closing balance of the Branch Debtors Account as of 31 December 2025 in Nigerian Naira ( $\text{₦}$ )?

Cevabı ve açıklamayı göster

Cevap: 23000

Cevap

The closing balance of the Branch Debtors Account as of 31 December 2025 is

\text{₦}23,000

.

The Branch Debtors Account is debited with opening debtor balances and credit sales, making the total debit side

\text{₦}83,000

. It is credited with all items that reduce debts owed by customers, including cash received (

\text{₦}54,000

), discounts allowed (

\text{₦}2,000

), bad debts written off (

\text{₦}1,000

), and goods returned by debtors (

\text{₦}3,000

), totaling

\text{₦}60,000

in credits. Subtracting total credits from total debits leaves a closing balance of

\text{₦}23,000

.

Adım Adım Çözüm

1

Calculate the total debits to the Branch Debtors Account

\text{Total Debits} = \text{₦}15,000 \text{ (Opening Balance)} + \text{₦}68,000 \text{ (Credit Sales)} = \text{₦}83,000

Debit entries increase the balance owed by branch trade debtors.

2

Calculate the total credits to the Branch Debtors Account

\text{Total Credits} = \text{₦}54,000 \text{ (Cash Received)} + \text{₦}2,000 \text{ (Discounts)} + \text{₦}1,000 \text{ (Bad Debts)} + \text{₦}3,000 \text{ (Returns)} = \text{₦}60,000

Credit entries reduce the balance owed by branch trade debtors through payments, allowances, irrecoverable amounts, and returned goods.

3

Determine the ending balance carried down

\text{Closing Balance} = \text{₦}83,000 - \text{₦}60,000 = \text{₦}23,000

The closing balance represents the net remaining amount due from branch debtors at the financial year end.

Anahtar Kavram

Branch Debtors Account Ledger Entry Rules for Dependent Branches

Soru 1300Soru →

Lagos Marine Services Ltd resolved to redeem $\text{₦}300,000$ nominal value of its $12\%$ debentures at a premium of $6\%$ . What is the total cash amount paid to debenture holders upon redemption?

Cevabı ve açıklamayı göster

Cevap: 318000

Cevap

The total cash amount paid to debenture holders upon redemption is ₦318,000.

When debentures are redeemed at a premium, the company pays debenture holders the nominal face value plus the agreed redemption premium percentage. Premium amount = 6% of ₦300,000 = ₦18,000. Total payment = ₦300,000 + ₦18,000 = ₦318,000.

Adım Adım Çözüm

1

Calculate the redemption premium amount

₦18,000

The premium on redemption is calculated as 6% of the nominal value (₦300,000).

2

Determine the total cash outflow for redemption

₦318,000

Total cash paid equals the nominal value plus the redemption premium.

Anahtar Kavram

Redemption of Debentures at a Premium

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