JAMB Accounting 2016 Objective — Question 38
Question 38 of 40 from the Joint Admissions and Matriculation Board (JAMB) Accounting 2016 Objective paper, with the correct answer and a full explanation.
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38. The initial cost of acquiring a fixed asset should be treated as (a) Dr: cash account Cr: asset account (b) Dr: assets account Cr: cash account (c) Dr: asset account Cr: Purchases account (d) Dr: Purchases account Cr: assets account
- A. Dr: cash account Cr: asset account
- B. Dr: assets account Cr: cash accountCorrect
- C. Dr: asset account Cr: Purchases account
- D. Dr: Purchases account Cr: assets account
Explanation
The accounting entry for purchase of fixed assets is Dr: asset account Cr: bank/cash account.
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