Q#1: Which of the following type of the business is governed under the Partnership Act 1932 in Pakistan?
(A) Sole-Proprietorship
(B) Partnership
(C) Limited Companies
(D) Unlimited Companies
Answer: (B) Partnership
Q#2: Which of the following is/are NOT example of current liability?
(A) Sundry Debtors
(B) Debentures
(C) Loan given to Mr. A for shorter period
(D) All of the given options
Answer: (A) Sundry Debtors
Q#3: Resources controlled by the entity as a result of a past event from which future economic benefits are expected are called:
(A) Assets
(B) Gains
(C) Liabilities
(D) Expenses
Answer: (A) Assets
Q#4: All of the following are assets EXCEPT:
(A) A building owned by the firm
(B) Goods in transit
(C) Money owed by debtors
(D) Money borrowed and not yet repaid
Answer: (D) Money borrowed and not yet repaid
Q#5: Which of the following relates to qualitative characteristics of financial information?
(A) Reliability only
(B) Relevancy only
(C) Both Reliability and Relevancy
(D) Comparability
Answer: (C) Both Reliability and Relevancy
Q#6: Which statement is true regarding Going Concern Concept?
(A) The business is profitable
(B) Assets are valued at market value
(C) Business will continue until directors decide to close it
(D) Business will continue its working
Answer: (D) Business will continue its working
Q#7: Financial statements are prepared on which assumptions?
(A) Future assumptions
(B) Past assumptions
(C) Accrual basis and Going concern basis
(D) Accrual basis only
Answer: (C) Accrual basis and Going concern basis
Q#8: Which one is NOT a physical asset?
(A) TFCs
(B) Loan agreements
(C) Trade receivables
(D) Goodwill
Answer: (D) Goodwill
Q#9: Which of the following is NOT a financial instrument?
(A) Share capital
(B) Loans payable
(C) Debentures
(D) Inventories
Answer: (D) Inventories
Q#10: A vehicle costing 20,000 is sold after 2 years under diminishing balance method with no profit/loss. Sale price is:
(A) 7,200
(B) 12,000
(C) 12,800
(D) 16,000
Answer: (C) 12,800
Q#11: Which of the following is NOT included in disclosure of trade debts?
(A) Amount due for goods sold
(B) Amount due for services rendered
(C) Amount due for contractual obligations
(D) Amount due in nature of loans or advances
Answer: (D) Amount due in nature of loans or advances
Q#12: Inventory valuation (NRV concept) total disclosure amount is:
(A) 44,000
(B) 47,000
(C) 57,000
(D) 60,000
Answer: (A) 44,000
Q#13: Which method is suitable when individual costs can be identified?
(A) FIFO
(B) LIFO
(C) Weighted Average
(D) Specific Identification
Answer: (D) Specific Identification
Q#14: Which authority regulates companies in Pakistan?
(A) SECP
(B) Federal Government
(C) Ministry of Finance
(D) All of the given options
Answer: (A) SECP
Q#15: Which statement is true about directors’ quorum?
(A) 1/3 or four whichever is greater
(B) 1/3 or four whichever is lesser
(C) 1/2 or four whichever is greater
(D) 1/2 or four whichever is lesser
Answer: (A) 1/3 or four whichever is greater
Q#16: Companies limited by shares means:
(A) Limited shares to offer
(B) Limited shareholders
(C) Liability of shareholders is limited
(D) Liability of shareholders is unlimited
Answer: (C) Liability of shareholders is limited
Q#17: Proper books of accounts are kept under section:
(A) 230
(B) 233
(C) 184
(D) 110
Answer: (A) 230
Q#18: NOT attributable to PPE cost:
(A) Administration overheads
(B) Installation cost
(C) Initial delivery cost
(D) Assembly cost
Answer: (A) Administration overheads
Q#19: Which expenditure cannot be capitalized?
(A) Air conditioner installation
(B) RAM addition
(C) New tyres
(D) Initial composition cost
Answer: (D) Initial composition cost
Q#20: Capitalization ceases when:
(A) Production starts
(B) Production ends
(C) Minor modifications complete
(D) Asset delivered for use
Answer: (D) Asset delivered for use
Q#21: An identifiable non-monetary asset without physical substance is:
(A) Tangible asset
(B) Intangible asset
(C) Floating asset
(D) Circulating asset
Answer: (B) Intangible asset
Q#22: Application of research findings is called:
(A) Applied research
(B) Business research
(C) Development
(D) Accounting
Answer: (C) Development
Q#23: Example of intangible asset:
(A) Preliminary expenses
(B) Copyrights
(C) Investments
(D) Discounts on shares
Answer: (B) Copyrights
Q#24: Under cost method, profit distribution is recorded as:
(A) Income
(B) Expense
(C) Liability
(D) Capital
Answer: (A) Income
Q#25: IAS for financial instruments disclosure is:
(A) IAS 27
(B) IAS 28
(C) IAS 31
(D) IAS 32
Answer: (D) IAS 32
Q#26: IAS 31 relates to:
(A) Consolidation
(B) Joint Venture
(C) Financial Instruments
(D) Recognition rules
Answer: (B) Joint Venture
Q#27: Disclosure of investment in associate requires explanation when:
(A) <20% equity method used
(B) <10% equity method used
(C) <10% or >20% variation cases
(D) <20% or >10% cases
Answer: (D) <20% or >10% cases
Q#28: Consolidated financial statements disclosure includes:
(A) Relationship when parent owns >50% voting power
(B) When parent owns <1/3 voting power
(C) When parent owns <1/4 voting power
(D) When parent owns <1/5 voting power
Answer: (A) When parent owns >50% voting power