JAMB Principles of Accounts (Accounting) past questions and answers

Checked by the Skolra question team · Last updated 23 October 2026

JAMB Principles of Accounts: 1,425 past questions from 29 papers between 1994 and 2025, each with the answer and an explanation. In the UTME you answer 40 Principles of Accounts questions, with Use of English and two other subjects, in 2 hours. Here are ten.

1. 1.The use of the folio in the ledger is for
   1. A
      cross-referencing entries with the books from which they were posted
      Correct
   2. B
      showing the balance carried down at the end of each period
   3. C
      numbering the pages of the ledger in serial order
   4. D
      recording the narration that explains each transaction
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   Answer: A

   Open any ledger account and you will see a narrow column headed Folio (written as J.F. for journal folio, or C.B. for cash book) sitting between the Particulars column and the Amount column. Whatever you post into that account, you write in the folio column the page number of the book of original entry the figure came from, and in that book you write the page number of the ledger account it went to.

   So the two records point at each other. That is why cross-referencing entries with the books from which they were posted is the correct use of the folio: it lets you trace any figure back to its source and to its corresponding double entry, which makes checking, error-tracing and auditing easy.

2. 2.

   Which of the following is used to service all operations of government?

   1. A
      Development Fund
   2. B
      Federation Account
   3. C
      Consolidated Revenue Fund
      Correct
   4. D
      Contingency Fund
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   Answer: C

   This one is straight from government accounting, and the key word in the stem is "all operations" — that means the general, everyday running of government, not one special purpose.

   The Consolidated Revenue Fund is that general fund. Section 80(1) of the 1999 Constitution says that all revenues or moneys received by the Federation, except those a law directs into another public fund, shall be paid into and form one Consolidated Revenue Fund. Money is then withdrawn from it, through the Appropriation Act, to pay salaries, overheads, statutory transfers, debt service and every other service of government. So it is the fund that services all operations of government.

3. 3.The receipt from a special tax levy to pay maturing interest obligation are recorded in
   1. A
      the debt service fund
      Correct
   2. B
      the general fund
   3. C
      the special revenue fund
   4. D
      the capital projects fund
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   Answer: A

   In public sector accounting, government resources are kept in separate self-balancing funds, and the rule is simple: the purpose for which the money is raised decides the fund it goes into.

   Read the stem again. The levy is raised for one stated purpose — to pay maturing interest obligation, that is, to service long-term debt. The fund created to receive and hold money set aside for the payment of interest and redemption of principal on general long-term debt as they mature is the debt service fund (what is often called the sinking fund arrangement). So the levy is received into that fund, and the interest is later paid out of that same fund.

4. 4.Which of the following is an intangible asset and a measure of a firm's superior earning power?
   1. A
      Patent right
   2. B
      Trade mark
   3. C
      Copyright
   4. D
      Goodwill
      Correct
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   Answer: D

   The key word in the question is "superior earning power". Only one intangible asset is actually a measure of how much more a business can earn than a normal business of its kind — and that is goodwill.

   Each of these is separately identifiable and can be sold on its own, and each is recorded at its cost of acquisition or registration. Goodwill, by contrast, cannot be sold apart from the business — it is the surplus value of the firm as a whole. So when a question links an intangible asset to superior or excess earning power, the answer is goodwill.

5. 5.When a transaction causes an assets account to increase, there is?
   1. A
      a debit entry in the asset account
      Correct
   2. B
      a debit entry in the capital account
   3. C
      a credit entry in the asset account
   4. D
      a credit entry in the liability account
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   Answer: A

   This question is testing the most basic rule of double entry, so hold it firmly: an increase in an asset is always a debit in that asset account, and a decrease in an asset is a credit.

   Assets (cash, bank, motor vehicle, stock, debtors) are real accounts, and the rule is "debit what comes in, credit what goes out". So when a transaction makes an asset grow, you post the entry on the debit side of that same asset account. For example, if a business buys a motor vehicle for ₦500,000 by cheque, you post Dr Motor vehicle ₦500,000 (that asset has increased) and Cr Bank ₦500,000 (that asset has decreased). Notice that the account which increased was debited.

6. 6.Which of the following is a debit item in the purchases ledger control account.
   1. A
      Credit purchases for the period
   2. B
      Balance of creditors brought forward
   3. C
      Interest charged by suppliers on overdue accounts
   4. D
      Discount received from suppliers
      Correct
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   Answer: D

   The purchases ledger control account (also called the creditors or trade payables control account) is a summary of all the supplier accounts. Creditors are a liability, so the account normally carries a credit balance. That single fact settles this question:

   Credit side — anything that increases what you owe: opening balance of creditors, credit purchases, interest or carriage charged to you by the supplier, and cheques to suppliers that were later dishonoured.
   Debit side — anything that reduces what you owe: cash and cheques paid to suppliers, returns outwards, bills payable accepted, contra set-off with the sales ledger control account, and discount received.

7. 7.You add the following when starting with the balance as per cash book when preparing the bank reconciliation statement except
   1. A
      Dividends collected by the bank on the customer's behalf
   2. B
      Cheques drawn but not yet presented for payment
   3. C
      Bank charges and commission debited by the bank
      Correct
   4. D
      Credit transfers paid into the account by the bank
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   Answer: C

   When you begin a bank reconciliation statement with the balance as per cash book, you are working your way towards the balance shown on the bank statement. So you add every item that makes the bank's balance higher than yours, and deduct every item that makes it lower.

   Items you ADD:
   • Unpresented cheques — you have already credited them in your cash book, but the payee has not yet taken them to the bank, so the bank still shows the money.
   • Dividends collected by the bank — the bank has credited the account but you have not yet entered it.
   • Credit transfers received by the bank on your behalf — again, money already in the bank but not yet in your cash book.

8. 8.A major factor that enhanced the early development of accounting is the?
   1. A
      expansion of trade and commerce
      Correct
   2. B
      growth of joint stock companies
   3. C
      industrial revolution in Britain
   4. D
      introduction of computers in business
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   Answer: A

   Answer: expansion of trade and commerce.

   Accounting did not start in a classroom; it started in the market. As trade grew among the merchants of the old Italian cities such as Venice, Genoa and Florence, goods were being sold on credit, partners were putting money into joint ventures, and traders were sending goods on long voyages. A merchant could no longer keep all of that inside his head. He needed a written record to show what he owned, what he owed, who owed him and whether the venture made a profit or a loss. That commercial pressure is what produced systematic bookkeeping, and it is the same growth in trade that led Luca Pacioli to publish the first printed description of the double entry system in 1494.

9. 9.

   Where there is no partnership agreement, a partner who advances loan to the partnership is entitled to ____ Interest

   1. A
      10% per annum
   2. B
      6% per annum
   3. C
      2.5% per annum
   4. D
      5% per annum
      Correct
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   Answer: D

   When partners do not draw up a partnership agreement (deed), the default provisions of the Partnership Act 1890 take over. Learn the rules as a set:

   1. Profits and losses are shared equally, no matter what each partner contributed.
   2. No interest is allowed on capital.
   3. No interest is charged on drawings.
   4. No partner is entitled to a salary.
   5. A partner who advances a loan to the firm, over and above his capital, is entitled to interest at 5% per annum.

10. 10.A reduction in the catalogue price of an article given by a wholesaler to a retailer is called a?
    1. A
       Trade discount
       Correct
    2. B
       Cash discount
    3. C
       Quantity rebate
    4. D
       Discount allowed
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    Answer: A

    Trade discount is the correct answer. When a wholesaler sells to a retailer, he knocks a percentage off the catalogue (list) price simply because the buyer is a fellow trader who is buying for resale. That deduction is a trade discount. Note this well: it is shown on the face of the invoice, and only the net amount is entered in the day book and the ledger. No account is opened for trade discount at all.

    So remember the simple rule: catalogue price less trade discount = invoice price; invoice price less cash discount = amount actually paid.

The questions come from past JAMB, WAEC and NECO papers. We use software to help write the answer options and explanations, and every answer is checked twice before it goes on the site. How we check

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