JAMB Accounting Past Questions and Answers (CBT Practice)

Introduction

Accounting is the systematic recording, classification, summarization, and interpretation of financial transactions for decision-making. It is a key subject in JAMB for students seeking admission into Accounting, Banking and Finance, Business Administration, and related courses. Success in Accounting requires understanding bookkeeping principles, financial statements, and basic business mathematics. This CBT practice contains 100 JAMB-standard objective questions with properly shuffled options A–D and correct answers.

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OBJECTIVE QUESTIONS

Instruction: Choose the correct option A–D.

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1–25: Basic Accounting Principles

1. Accounting is the process of
   A. manufacturing goods B. recording financial transactions C. farming activities D. advertising products
   Answer: B

2. The main purpose of accounting is to
   A. increase production B. provide financial information C. reduce taxation D. manage labour
   Answer: B

3. A person who prepares accounts is called
   A. engineer B. accountant C. farmer D. trader
   Answer: B

4. The accounting equation is
   A. Assets = Liabilities + Capital B. Assets = Capital − Liabilities C. Capital = Assets + Expenses D. Liabilities = Assets + Income
   Answer: A

5. Capital refers to
   A. money owed B. owner’s investment in the business C. goods sold D. expenses incurred
   Answer: B

6. Liabilities are
   A. assets owned B. debts owed by the business C. profits earned D. salaries paid
   Answer: B

7. Assets are
   A. debts only B. resources owned by a business C. expenses only D. losses only
   Answer: B

8. The double entry principle states that
   A. every transaction has two effects B. only one entry is recorded C. no record is needed D. only cash is recorded
   Answer: A

9. Debit means
   A. left side of account B. right side of account C. profit D. loss
   Answer: A

10. Credit means
    A. left side of account B. right side of account C. expense D. asset
    Answer: B

11. A ledger is a book of
    A. original entry B. final accounts C. secondary entry D. receipts only
    Answer: C

12. The journal is used for
    A. recording transactions initially B. preparing balance sheet C. calculating profit D. storing assets
    Answer: A

13. Trial balance is used to
    A. detect fraud only B. check arithmetic accuracy C. record sales D. calculate tax
    Answer: B

14. If debits equal credits, the trial balance is
    A. incorrect B. balanced C. useless D. invalid
    Answer: B

15. An invoice is a document issued by
    A. buyer B. seller C. bank D. government
    Answer: B

16. A receipt is evidence of
    A. purchase B. payment made C. loan received D. profit earned
    Answer: B

17. Cash discount is given for
    A. bulk purchase B. early payment C. late payment D. damaged goods
    Answer: B

18. Trade discount is deducted from
    A. net price B. list price C. salary D. profit
    Answer: B

19. Purchases refer to goods bought for
    A. resale B. personal use C. donation D. destruction
    Answer: A

20. Sales refer to goods
    A. bought B. sold C. stored D. produced
    Answer: B

21. Revenue means
    A. expenses B. income earned C. liabilities D. assets
    Answer: B

22. Expenses are
    A. incomes B. costs incurred in business C. capital D. profits
    Answer: B

23. Profit is
    A. expenses > revenue B. revenue > expenses C. assets = liabilities D. capital = cash
    Answer: B

24. Loss occurs when
    A. revenue exceeds expenses B. expenses exceed revenue C. assets increase D. liabilities decrease
    Answer: B

25. Bookkeeping involves
    A. recording financial transactions B. manufacturing C. farming D. advertising
    Answer: A

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26–50: Books of Accounts and Final Accounts

26. The book of original entry is
    A. ledger B. journal C. balance sheet D. trial balance
    Answer: B

27. Posting means
    A. recording in journal B. transferring to ledger C. calculating tax D. balancing accounts
    Answer: B

28. A ledger account has
    A. one side B. two sides C. three sides D. no sides
    Answer: B

29. The cash book records
    A. credit transactions only B. cash transactions C. assets only D. liabilities only
    Answer: B

30. Petty cash book is used for
    A. large payments B. small expenses C. bank loans D. capital investment
    Answer: B

31. Capital account shows
    A. liabilities B. owner’s investment C. expenses D. sales
    Answer: B

32. Drawings refer to
    A. business income B. money withdrawn by owner C. bank deposits D. sales returns
    Answer: B

33. Sales returns are also called
    A. return inward B. return outward C. purchases D. assets
    Answer: A

34. Purchases returns are also called
    A. return inward B. return outward C. expenses D. liabilities
    Answer: B

35. Closing stock is
    A. goods sold B. unsold goods at end of period C. fixed assets D. cash balance
    Answer: B

36. Cost of goods sold is
    A. opening stock + purchases − closing stock B. sales − profit C. assets − liabilities D. capital − expenses
    Answer: A

37. Trading account is prepared to determine
    A. net profit B. gross profit C. liabilities D. assets
    Answer: B

38. Profit and loss account shows
    A. gross profit only B. net profit or loss C. assets only D. liabilities only
    Answer: B

39. Balance sheet shows
    A. income only B. financial position C. sales only D. expenses only
    Answer: B

40. Assets in balance sheet are listed
    A. alphabetically B. in order of liquidity C. randomly D. by size only
    Answer: B

41. Current assets include
    A. buildings B. cash C. machinery D. land
    Answer: B

42. Fixed assets include
    A. cash B. inventory C. land and buildings D. debtors
    Answer: C

43. A debtor is a person who
    A. owes the business B. is owed by the business C. invests capital D. manages accounts
    Answer: B

44. A creditor is a person to whom the business
    A. owes money B. is owed money by C. sells goods D. produces goods
    Answer: A

45. Bank reconciliation statement is used to
    A. check cash sales B. reconcile bank and cash book balances C. calculate profit D. record purchases
    Answer: B

46. Errors of omission occur when
    A. transaction is not recorded B. wrong amount recorded C. wrong posting D. double entry done
    Answer: A

47. Errors of commission involve
    A. omission B. wrong entry C. complete absence D. fraud only
    Answer: B

48. Suspense account is used to
    A. correct errors temporarily B. increase capital C. record sales D. calculate tax
    Answer: A

49. Depreciation is
    A. increase in value B. reduction in value of assets C. profit D. capital gain
    Answer: B

50. Methods of depreciation include
    A. straight line method B. inflation method C. taxation method D. budgeting method
    Answer: A

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51–100: Advanced Accounting Concepts

51. Accrual concept means
    A. income recognized when earned B. cash only accounting C. ignoring expenses D. ignoring income
    Answer: A

52. Going concern assumes business will
    A. close immediately B. continue indefinitely C. stop trading D. liquidate daily
    Answer: B

53. Consistency concept requires
    A. changing methods often B. using same accounting methods C. ignoring rules D. random recording
    Answer: B

54. Prudence concept means
    A. overstate profit B. understate profit C. anticipate losses but not gains D. ignore losses
    Answer: C

55. Accounting period is usually
    A. 1 day B. 1 month C. 1 year D. 5 years
    Answer: C

56. Source documents include
    A. invoice and receipt B. balance sheet only C. profit account only D. trial balance only
    Answer: A

57. A cheque is issued by
    A. bank B. account holder C. government D. auditor
    Answer: B

58. Bank overdraft is
    A. fixed asset B. short-term loan from bank C. capital D. revenue
    Answer: B

59. Capital expenditure is for
    A. daily expenses B. long-term assets C. wages D. rent
    Answer: B

60. Revenue expenditure is for
    A. fixed assets B. day-to-day operations C. land purchase D. building
    Answer: B

61. A partnership agreement is called
    A. deed of partnership B. constitution C. budget D. invoice
    Answer: A

62. Goodwill is
    A. physical asset B. intangible asset C. liability D. expense
    Answer: B

63. Bank statement is issued by
    A. customer B. bank C. auditor D. government
    Answer: B

64. Capital account increases with
    A. debit B. credit C. withdrawal D. loss only
    Answer: B

65. Drawings account is
    A. debited B. credited C. ignored D. fixed
    Answer: A

66. Manufacturing account is prepared to determine
    A. production cost B. profit only C. cash balance D. liabilities
    Answer: A

67. Stock valuation is usually done at
    A. cost or net realizable value B. selling price only C. random value D. inflated value
    Answer: A

68. Accounting standards ensure
    A. confusion B. uniformity C. fraud D. loss
    Answer: B

69. Internal control helps to
    A. prevent fraud B. increase fraud C. reduce sales D. increase errors
    Answer: A

70. External audit is done by
    A. internal staff B. independent auditor C. manager only D. cashier
    Answer: B

71. Final accounts are prepared at
    A. daily basis B. end of accounting period C. weekly D. hourly
    Answer: B

72. Income statement is another name for
    A. trading account B. profit and loss account C. balance sheet D. ledger
    Answer: B

73. Capital introduced increases
    A. liabilities B. assets C. drawings D. expenses
    Answer: B

74. Purchase of machinery is recorded as
    A. revenue expenditure B. capital expenditure C. loss D. income
    Answer: B

75. Bank charges are
    A. income B. expenses C. assets D. capital
    Answer: B

76. Interest on loan is
    A. asset B. expense C. capital D. stock
    Answer: B

77. Sales return reduces
    A. sales B. purchases C. capital D. liabilities
    Answer: A

78. Purchases return reduces
    A. purchases B. sales C. capital D. income
    Answer: A

79. Income is increased by
    A. debit B. credit C. withdrawal D. loss
    Answer: B

80. Expense is increased by
    A. credit B. debit C. capital D. liability
    Answer: B

81. Trial balance is prepared
    A. after balance sheet B. before final accounts C. after profit only D. randomly
    Answer: B

82. Accounting cycle ends with
    A. journal B. final accounts C. ledger D. invoice
    Answer: B

83. Working capital is
    A. fixed assets − liabilities B. current assets − current liabilities C. capital − expenses D. profit − loss
    Answer: B

84. Cash sales increase
    A. liabilities B. cash C. expenses D. drawings
    Answer: B

85. Credit sales increase
    A. debtors B. creditors C. cash D. capital
    Answer: A

86. A voucher is
    A. evidence of transaction B. bank loan C. asset D. liability
    Answer: A

87. Control account helps to
    A. summarize ledger balances B. reduce profit C. increase fraud D. ignore records
    Answer: A

88. The principle of duality is also called
    A. double entry B. single entry C. cash basis D. accrual basis
    Answer: A

89. Accounting helps in
    A. decision making B. farming C. transportation D. construction only
    Answer: A

90. Financial statements include
    A. balance sheet B. profit and loss account C. both A and B D. invoice only
    Answer: C

91. Cash book is both
    A. ledger and journal B. asset and liability C. income and expense D. trial balance
    Answer: A

92. Errors in accounting affect
    A. accuracy of reports B. weather C. production only D. transport
    Answer: A

93. Capital withdrawal reduces
    A. capital B. revenue C. expense D. profit
    Answer: A

94. Credit purchases increase
    A. cash B. creditors C. debtors D. capital
    Answer: B

95. Debit balance appears on
    A. right side B. left side C. both sides D. nowhere
    Answer: B

96. Credit balance appears on
    A. left side B. right side C. debit side D. asset side
    Answer: B

97. A financial year usually runs for
    A. 6 months B. 12 months C. 18 months D. 24 months
    Answer: B

98. Accounting information is mainly used by
    A. farmers only B. stakeholders C. drivers D. students only
    Answer: B

99. Profit maximization is a goal of
    A. accounting B. business C. farming D. transport
    Answer: B

100. The ultimate aim of accounting is to
     A. provide useful financial information for decision making B. increase errors C. reduce records D. avoid reporting
     Answer: A

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EXAM SUCCESS TIPS

• Master double entry principles thoroughly.
• Practice preparation of financial statements.
• Understand accounting concepts and principles.
• Learn classification of assets, liabilities, and capital.
• Revise depreciation and adjustments.
• Practice past JAMB CBT questions regularly.
• Understand source documents and their uses.
• Study partnership and company accounts basics.
• Learn how to interpret financial reports.
• Take timed CBT practice tests before the exam.