JAMB Accounting 2016 Objective — Question 32

Question 32 of 40 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2016 Objective paper, with the correct answer and a full explanation.

32. Share premium can be used to i. Write off preliminary expenses ii. Give loans to employees, iii. Pay dividends, (a) i and iii only (b) i and iii only (c) ii and iii only (d) i only

A. i and ii only
B. i and iii only
C. ii and iii only
D. i onlyCorrect

Explanation

Share premium can be used to write-off the preliminary expenses. Preliminary expenses are formation expenses.

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