# Principles of Accounts 2015 | Study Mode

Question 61
A
fictitious assets
B
liquid assets
C
wasting assets
D
tangible assets
##### Explanation
preliminary expenses are just like other asset but are unrealizable.

Question 62
A
credit sales account and debit Patricks account
B
credit generator account and debit cash account
C
credit sales account and debit cash account
D
credit generator account and debit Patricks account
##### Explanation
Patrick is receiving and should be debited while generator account is giving

Question 63
A
N7950
B
N8050
C
N7050
D
N8950
##### Explanation
The gross profit percentage of sales would be

20% x N 10,000 = N 2000

If cost of sales + gross profit = N 10,000 = N 2000

:. N 8000 + N 2000 = N 10,000

If cost of goods available for sales less closing stock

= cost of sales

:. N8200 + N200 = N8000

Hence; cost of goods available for sale = opening stock + purchases

:. N8200 = N250 + A

= N 8200 N 250

=N 7950

Question 64
A
N1.183
B
N1.025
C
N1.00
D
N1.05
##### Explanation
simple average method usually add up all receipt prices ahead of the issued material divided by 2

Question 65
A
N169, 200
B
N44, 200
C
N55, 800
D
N230, 200
##### Explanation
The prime cost are direct cost,direct material cost, direct labour cost and direct expenses.

Therefore:

Raw materials (jan)5000

Less raw materials (dec) 5,800

Cost of raw materials consume 44,200

Prime cost 169,200

Question 66
A
cash
B
cheques
C
debtors
D
stocks
##### Explanation
the income and expenditure account unlike the receipts and payments takes records of accruals and prepayment

Question 67
A
revaluation surplus
B
pre-incoporation profit
C
D
general reserves
##### Explanation
general reserves is not a form of capital reserves. It is considered as revenue reserves

Question 68
A
timeliness
B
accuracy
C
completeness
D
affordability
##### Explanation
accounting information and report must be accurate, complete and timely. Money spent to obtain an information is not as important as how useful are those information in taking decisions.

Question 69
A
periodicity
B
C
dual aspect
D
going concern
##### Explanation
This concept is the only one among the listed that assumes that the business will continue to operate for an indefinitely long period of time.

Question 70
A
sales
B
carriage outwards
C
gross profit or loss
D
net profit or loss
##### Explanation
The trading account is primarily prepared to ascertain gross profit or loss.

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