JAMB Accounting 2015 Objective — Question 15

Question 15 of 50 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2015 Objective paper, with the correct answer and a full explanation.

Sobande Incorporation acquired a machine involving: Gross invoice price ₦15,000; Sales tax ₦900; Purchases discount taken ₦300; Freight ₦750; Assembly of machine ₦500; Installation of machine ₦800; Assorted spare parts for future use ₦1,200; Turning and adjusting machine ₦700. What is the initial accounting cost of the machine?

A. ₦19,550
B. ₦18,950
C. ₦18,350Correct
D. ₦17,500

Explanation

Cost = 15,000+900−300+750+500+800+700 = ₦18,350 (spare parts for future use are excluded as they are a separate inventory item, not part of the machine's cost).

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