JAMB Accounts Principles of Accounts 2011 Paper

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Question : 8

Total: 49

Use the information below to answer question .

Adamu Stores bought accessories from Mu'azu Beverages for N400 on credit. A trade discount of 10% and a cash discount of 15% were provided.

Find the total amount paid?

N260
N300
N200
N380

Solution:

Concept:

Both trade discount and cash discount reduce the actual amount paid on the list price.

Explanation:

List price = N400.

Total discount allowed = 10% + 15% = 25%.

Amount paid = 75% of N400 =

\frac{75}{100} \times 400 = N300

.

Answer:

N300. The correct option is B, so .

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