Solved MCQs of Accounting & Auditing Past Papers
 

[CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -I (2000)[/U][/COLOR][/SIZE][/B][/CENTER]

(1) Double entry book-keeping was fathered by:
(a) F.W.Taylor
(b) Henry Fayol
[B](c) Lucas Pacioli.[/B]

(2) Funds Flow Statement and sources and application statement are:’
[B](a) Synonymous [/B]
(b) Antagonistic
(c) None of these.

(3) Depreciation in spirit is similar to:
(a) Depletion
[B](b) Amortization [/B]
(c) Depression.

4) Balance Sheet is always prepared:
(a) for the year ended.
[B](b) As on a specified date. [/B]
(c) None of these.

(5) In Insurance, the following Profit and Loss Accounts are prepared:
(a) Separate for Fire, Marine, and Accidents etc.
[B](b) Consolidated for Fire, Marine, and Accidents etc.[/B](c) None of these.

(6) Partners in Pakistan can today be fixed at the following numbers:
[B](a) 20 [/B]
(b) 50
(c) 75.

(7) Flexible budget is a budget with the following features:
[B](a) Changes with volume of production.[/B]
(b) Changes with variable expenses
(c) Changes in Direct material.

(8) Break Even can be calculated as under:
(a) ______VC_______
FC- TR TC
[B](b) FC
I- VC TR[/B](c) None of these.

(9) Quick Ratio can be computed as under:
(a) Quick . Assets/Quick Liabilities
(b) Quick . Liabilities Current Assets
[b](c) Current Assets/ Current Liabilities[/b]

(10) In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under:
(a) Rupee one
[B](b) Rupee zero [/B](c) None of these.

(11) Sales budget must be prepared:
(a) Independently
(b) Depending on production capacity
[B](c) Based on Sales forecasts of market. [/B]

(12) Consolidation of subsidiary accounts in the balance sheet of a unlisted Holding company is at present in Pakistan:
(a) Compulsory
(b) Voluntary
[B](c) Required. [/B]

(13) Retained earning is synonymous to:
[B](a) Accumulated profit and loss account[/B]
(b) Profit for the year
(c) None of these.

(14) The requirements of an audit report for a Banking Company in Pakistan is under:
(a) Under the Banking Companies Ordinance, 1962.
(b) Under the Companies Ordinance, 1984.
[B](c) Under (a) and (b) above.[/B]

(15) Deferred Taxation is:
(a) Fixed asset
(b) Fixed liabilities
[B](c) Part of Owners Equity.[/B]

(16) Investment Corporation of Pakistan follows:
(a) Open-end mutual funds
(b) Closed-end mutual funds
[B](c) None of these.[/B]

(17) Directors Report is ---- in respect of financial report constituent.
[B](a) Mandatory for a limited Company[/B]
(b) Voluntary for a limited Company
(c) None of these.

(18) Every limited Company in Pakistan is required by law to include the following along with financial reports:
(a) Ratio Analysis
[B](b) Chairman’s Review[/B]
(c) None of these.

(19) Cash budget excludes the following:
[B](a) Non-Cash items[/B]
(b) Cash items
(c) Purchase on Credit items.

(20) NGOs are legally required to:
[B](a) Prepare accounts in a prescribed manner under the law.[/B](b) Prepare accounts as desired by donors.
(c) None of these.




[CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -II (2000)[/U][/COLOR][/SIZE][/B][/CENTER]


1. Fixed Cost:
a. Changes with production
[B]b. Never changes even if production capacity is doubled[/B]
c. None of the above

2. Conversion cost is:
a. Material Cost + Overhead Cost
b. Direct Labour + Material Cost
[B]c. Labour Cost + Overhead Cost[/B]

3. Process Costing is relevant to:
[B]a. Cement industry[/B]
b. Job Order cost oriented Projects
c. None of the above

4. Operating Profit is:
a. Profit after deducting financial costs
b. Profit after deducting taxes
[B]c. Profit after deducting normal operating expenses including depreciation[/B]

5. A good Cost Accounting System is:
a. If it computes estimated cost only
b. If it cannot be reconciled with financial accounts
[B]c. If it enables management to increase productivity and rationalize cost structure[/B]

6. Verification includes:
a. Checking Vouchers
b. Examining audit report
[B]c. None of the above[/B]

7. Stratified audit sample means:
[B]a. Randomly selected items for audit[/B]
b. Purposively selected items for audit
c. Items carefully selected from each group

8. Internal Control is totally synonymous with:
a. Internal check
b. Internal audit
[B]c. None of above[/B]

9. Audit of a bank is generally conducted through:
[B]a. Routine checking[/B]
b. Couching
c. Balance sheet audit

10. An auditor is liable for his annual audit of accounts o:
a. Creditors
b. Bankers
[B]c. Owners[/B]

11. Income Tax is levied on:
a. Agricultural Income
[B]b. Presumptive Income[/B]
c. None of above

12. If a firm has paid super-tax, its partners may follow any one of the following behaviours:
a. No need to pay income tax, even if the income exceeds the taxable limit.
b. Pay income tax, even if the income does not exceed the taxable income.
[B]c. Pay income tax as required under the law.[/B]

13. A resident multinational company need not:
a. Pay income tax, if it s caused under Double Taxation agreement.
b. If it is not enjoying tax exemption under the Income Tax Ordinance, 1979 (Second Schedule).
[B]c. None of above[/B]

14. Income Tax rates are the same for:
a. Limited Companies
[B]b. Banking Companies[/B]
c. None of above

15. Super Tax on companies is:
a. In vogue in Pakistan
[B]b. Not in vogue in Pakistan[/B]
c. None of above

16. Current Ratio is calculated as:
a. Fixed Assets/Current Liabilities
b. Current Liabilities/Current Assets
[B]c. Current Assets/Current Liabilities[/B]

17. Short-term loan can be described as:
a. If the period is three years
[B]b. If the period is less than one year[/B]
c. If the period is over one year

18. A partnership, in today’s Pakistan, under the current law can have the following number of partners:
a. 50
[B]b. 20[/B]
c. 100

19. Combination can be best described as:
a. Restructuring of Capital of a Company
b. Reduction of Capital of a Company
[B]c. Amalgamation of two different types of businesses[/B]

20. Sources of funds can be increased by:
a. Describing selling prices
b. Increasing expenditure
[B]c. None of above [/B]

do correct the mistakes fellas, if any.
 

[B][U][SIZE="5"][CENTER][COLOR="Blue"]Accounting & Auditing paper-I (2001)[/COLOR][/CENTER][/SIZE][/U][/B]

Write only the correct answer in the Answer Book. Do not reproduce the questions.

(1) Books of original entry are called:
(a) Ledger
(b) Work sheets
[B](c) Journal[/B]
(d) None of these

(2) For preparing balance sheets prepaid expenses are shown as part of:
(a) Liability
(b) Equities
[B](c) Assets[/B]
(d) None of these

(3) Unpaid and unrecorded expenses are called:
(a) Prepaid expenses
[B](b) Accrued expenses[/B]
(c) Additional expenses
(d) None of these

(4) Amount, cash, or other assets removed from business by owner is:
(a) Capital
[B](b) Drawings[/B]
(c) Assets
(d) None of these

(5) Under the diminishing balance method, depreciation amount is:
(a) Payment
(b) Receipt
[B](c) Expenditure[/B]
(d) None of these

(6) Users of accounting information include:
(a) The tax authorities
(b) Investors
(c) Creditors
[B](d) All of these[/B]

(7) The business form(s) in which the owner(s) is (are) personally liable is (are) the:
(a) Partnership only
(b) Proprietorship
(c) Corporation only
[B](d) Partnership and proprietorship [/B]
(e) None of these

(8) The investment of personal assets by the owner:
[B](a) Increases total assets and increases owner’s equity[/B]
(b) Increases total assets only
(c) Has no effect on assets but increases owner’s equity
(d) Increase assets and liabilities
(e) None of these

(9) All of the following are forms of organizations except:
(a) Proprietorship
(b) Corporation
[B](c) Retailer[/B]
(d) Partnership
(e) None of these

(10) Economic resources of a business that are expected to be of benefit in the future are referred to as:
(a) Liabilities
(b) Owner’s equity
(c) Withdrawals
[B](d) Assets[/B]
(e) None of these

(11) An owner investment of land into the business would:
(a) Decrease withdrawals
(b) Increase liabilities
[B](c) Increase owner’s equity[/B]
(d) Decrease assets
(e) None of these

(12) A cash purchase of supplies would:
(a) Decrease owner’s equity
(b) Increase liabilities
[B](c) Have no effect on total assets[/B]
(d) None of these

(13) An owner investment of each into the business would:
[B](a) Increase assets[/B]
(b) Decrease liabilities
(c) Increase withdrawals
(d) Decrease owner’s equity
(e) None of these

(14) The payment of rent each month for office space would:
[B](a) Decrease total assets[/B]
(b) Increase liabilities
(c) Increase owner’s equity
(d) None of these

(15) Real accounts are related to:
[B](a) Assets[/B]
(b) Expenses and incomes
(c) Customers and Creditors etc.
(d) None of these

(16) Which one of the following accounts would usually have a debit balance?
[B](a) Cash[/B]
(b) Creditors
(c) Accounts payable
(d) Salaries Expenses
(e) None of these

(17) Quick assets include which of the following?
(a) Cash
(b) Accounts Receivable
(c) Inventories
[B](d) Only (a) and (b)[/B]
(e) None of these

(18) Net income plus operating expenses is equal to:
(a) Net sales
(b) Cost of goods available for sale
(c) Cost of goods sold
[B](d) Gross profit[/B]
(e) None of these

(19) The maximum number of partners in Pakistan can be fixed at the following:
[B](a) 20[/B]
(b) 50
(c) 75
(d) None of these

(20) Balance sheet is always prepared:
(a) For the year ended
[b](b) As on a specific date[/b]
(c) None of these

[U][B][SIZE="5"][COLOR="blue"][CENTER]Accounting & Audting Paper-II (2001)[/CENTER][/COLOR][/SIZE][/B][/U]

Write only the correct answer in the Answer Book. Do not reproduce the questions.

(1) The measureable value of an alternative use of resources is referred to as:
[B](a) An opportunity cost[/B]
(b) An imputed cost
(c) A different cost
(d) A sunk cost
(e) None of these

(2) A quantitative expression of management objectives is an:
(a) Organizational chart
(b)Management chart
[B](c) Budget[/B]
(d) Procedural chart
(e) None of these

(3) A cost center is:
(a) A unit of production in relation to which costs are ascertained
(b) A location which is responsible for controlling direct costs
(c) Part of the factory overhead system by which costs are gathered
[B](d) Any location or department which incurs cost[/B]
(e) None of these

(4) At break-even point of 400 units sold the variable costs were Rs. 400 and the fixed costs were Rs.200. What will be the 401 units sold contributing to profit before income tax?
(a) Rs. 0.00
[B](b) Rs. 0.50[/B]
(c) Rs. 1.00
(d) Rs. 1.50
(e) None of these

(5) In considering a special order situation that will enable a company to make use of currently idle capacity, which of the following cost will be irrelevant:
(a) Materials
[B](b) Depreciation[/B]
(c) Direct labour
(d) Variable factory overhead
(e) None of these

(6) A fixed cost:
(a) May change in total when such change is not related to changes in production
[B](b) Will not change in total because it is not related to changes in production[/B]
(c) Is constant per unit for each unit of change in production
(d) May change in total, depending on production with the relevant range
(e) None of these

(7) Completion of a job is result in:
[B](a) DR finished goods …….. CR WIP[/B]
(b) DR Cost of goods ……... CR finished goods
(c) DR WIP ……………..….….. CR FOH control
(d) DR FOH control …….….. CR FOH applied
(e) None of these

(8) Operating cost in often named as:
(a) Manufacturing cost plus commercial expenses
(b) Prime cost plus factory overheads
(c) Direct material plus direct labour
[B](d) Selling plus administrative expenses[/B]
(e) None of these

(9) Expenses such as rent and depreciation of a building are shared by several departments these are:
[B](a) Indirect expenses[/B]
(b) Direct expenses
(c) Joint expenses
(d) All of the above
(e) None of these

(10) If under applied FOH is closed to cost of goods sold, the journal entry is:
([B]a) DR Cost of goods sold …….. CR FOH control[/B]
(b) DR FOH control ……..……….. CR Cost of goods sold
(c) DR FOH control ……..……….. CR Profit % loss account
(d) None of these

(11) Re-order quantity …… 3600 units
Maximum consumption ...… 900 units per week
Minimum comsumption …....300 units per week
Re-order period …………….….5 weeks
Based on this data Re-order level is:
[B](a) 4500 units[/B]
(b) 3900 units
(c) 1200 units
(d) 400 units
(e) None of these

(12) The time lag between indenting and receiving material is called:
[B](a) Lead time[/B]
(b) Idle time
(c) Stock out time
(d) None of these

(13) A credit balance remaining in FOH Control account is called:
[B](a) Over-applied overhead[/B]
(b) Under-applied overhead
(c) Actual overhead
(d) None of these

(14) Direct material cost plus direct labour cost is called:
[B](a) Prime cost[/B]
(b) Conversion cost
(c) Product cost
(d) All of these
(e) None of these

(15) Productivity means:
[B](a) The ability to produce[/B]
(b) All units produced
(c) Good units produced
(d) None of these

(16) A segment of the business that generates both revenue and cost is called:
[B](a) Profit Center[/B]
(b) Cost Center
(c) Cost driver
(d) All of these
(e) None of these

(17) Verification includes:
(a) Checking vouchers
(b) Examining audit report
[B](c) None of these[/B]

(18) Audit of a bank is generally conducted through:
[B](a) Routine checking[/B]
(b) Vouching
(c) Balance sheet audit
(d) None of these

(19) Economics resources of a business that are expected to be of benefit in the future are referred to as:
(a) Liabilities
[B](b) Owner’s equity[/B]
(c) Withdrawals
(d) Assets
(e) None of these

(20) Short term Loan can be best described as:
(a) If the period is three years
[b](b) If the period is less than one year[/b]
(c) If the period is over one year
(d) None of these

[COLOR="seagreen"][CENTER][U][B][SIZE="5"]Accounting & Auditing Paper-I (2002)[/SIZE][/B][/U][/CENTER][/COLOR]

(1) Maximum number of partners in a partnership firm set up in Pakistan under Partnership Act, 1932 is:
(a) 5
(b) 25
[B](c) 20[/B]
(d) None of these

(2) Preparation of final financial reports is governed in Pakistan under:
(a) No law
[B](b) Companies Ordinance 1984[/B]
(c) None of these

(3) Depreciation is based on:
[B](a) Economic life of asset[/B]
(b) Declared life of asset by supplier
(c) Normal life of asset
(d) None of these

(4) Inventory turnover is calculated as under:
(a) [B]Cost of Goods sold/Closing Inventory[/B]
(b) Gross profit/Closing Inventory
(c) Sales/Opening Inventory
(d) None of these

(5) There is a difference between:
(a) Worksheet and Balance Sheet
(b) Worksheet and profit and loss account
(c) Worksheet as combination of results of profits and financial positions
(d) None of these

(6) Deferred Revenue is:
[B](a) Liability[/B]
(b) Asset
(c) None of these

(7) Preparation of annual report of a firm is governed under:
(a) Partnership Act 1932
(b) Under partnership Deed
[B](c) None of these[/B]

(8) Deferred Taxation amount be treated as:
(a) Foot note
[B](b) An item in the Balance Sheet on asset side[/B]
(c) None of these

(9) Return of Equity will be calculated as under:
(a) Operating Profit x 100/Equity
[B](b) Net profit x 100/Paid up Capital only[/B]
(c) None of these

(10) Current maturity of long term loan is:
[B](a) Current Liability[/B]
(b) Long Term Liability
(c) None of these

[B][U][CENTER][SIZE="5"][COLOR="SeaGreen"]Accounting & Auditing Paper-II (2002)[/COLOR][/SIZE][/CENTER][/U][/B]

Write only the correct answer in the Answer Book. Do not reproduce the questions.

(1) Prime cost is calculated as under:
(a) Manufacturing Cost/Cost of Goods Sold
(b) Direct Method plus factory overheads
[B](c) Direct labour + Direct Material[/B]
(d) None of these

(2) Process Cost is very much applicable in:
[B](a) Construction Industry[/B]
(b) Pharmaceutical Industry
(c) Air line company
(d) None of these

(3) The latest computation of variances of manufacturing overheads is in one the following ways:
(a) Two variance approaches
(b) Three variance approaches
(c) Four variance approaches
(d) None of these

(4) Random sampling in auditing means:
(a) Selection through convenience sampling
[B](b) Selection through scientific sampling approach[/B]
(c) None of these

(5) Expenditure incurred in procuring machinery is:
(a) An admissible expenditure for tax purposes
(b) No admissible for tax purposes
(c) None of these

(6) Increase in income constitutes:
[B](a) Inflows[/B]
(b) Outflows
(c) None of these

(7) M & A stands for:
(a) Mergers & Analysis
[B](b) Mergers & Acquisitions[/B]
(c) Mergers & Allocation
(d) None of these

(8) An endowment insurance policy can be taken in respect of:
(a) Fire insurance
(b) Accident insurance
[B](c) Life insurance[/B]
(d) None of these

(9) Audit and special audit are the same:
(a) In Insurance Company
(b) In Banking Company
(c) None of these

(10) Acid test is the same as:
[B](a) Quick test[/B]
(b) Liquid test
(c) None of these

(8) Deferred Taxation amount be treated as:
(a) Foot note
(b) An item in the Balance Sheet on asset side
(c) None of these

None of these may be the answer because deferred taxation is what you have recognized in your financial statement but not paid to tax authorities, so it should be a liability. But I am not sure.

(9) Return of Equity will be calculated as under:
(a) Operating Profit x 100/Equity
(b) Net profit x 100/Paid up Capital only
[B](c) None of these[/B]

Return on Equity is calculated as Net Profit/Shareholders' Equity x 100

[B][U][CENTER][COLOR="DarkRed"][SIZE="5"][SIZE="4"]Accounting & Auditing Paper-I (2003)[/SIZE][/SIZE][/COLOR][/CENTER][/U][/B]

(1) Acid Test Ratio is calculated as under:
(a) Current Assets/Current Liabilities
(b) Fixed Assets/Current Liabilities
[B](c) Liquid Assets/Current Liabilities[/B]
(d) None of these

(2) Deferred cost is a:
(a) Liability
[B](b)Asset[/B]
(c) None of these

(3) Work Sheet is:
(a) Balance Sheet
(b) Fund Flows Statement
[B](c) A combination of Profit and Loss Account and Balance Sheet items[/B]
(d) None of these

(4) Banks, for the preparation of financial statements, are governed under:
[B](a) Banking Companies Ordinance, 1962[/B]
(b) State Bank of Pakistan Act
(c) None of these

(5) Return on investment is computed:
(a) Investment/Profit x 100
[B](b) Profit x 100/Investment[/B]
(c) None of these

[COLOR="darkred"][CENTER][U][B][SIZE="5"][SIZE="4"]Accounting & Auditing Paper-II (2003)[/SIZE][/SIZE][/B][/U][/CENTER][/COLOR]

Write only the correct answer in the Answer Book. Do not reproduce the questions.

(1) Rent of the premises constitutes variable expenses for cost allocation:
[B](a) True[/B]
(b) False

(2) Sugar used in a sugarcane company is:
[B](a) Variable cost[/B]
(b) Fixed cost
(c) None of these

(3) An auditor is liable under the following circumstances:
(a) Third Party Liabilities
[B](b) Fraud perpetrated in highly sophisticated circumstances[/B]
(c) None of these

(4) Agricultural income is taxable under the Income Tax Laws of Pakistan:
(a) True
[B](b) False[/B]

(5) Principal and markup payment within one year constitutes long term liability for disclosure in the balance sheet of a company.
(a) True
[B](b) False[/B]

(6) Ordinarily one can have the following partners in a partnership in Pakistan under the Partnership Act 1932.
(a) 10
[B](b) 20[/B]
(c) 30
(d) None of these

(7) Working Capital finance can be termed as “Running Finance” in a limited company.
[B](a) True[/B]
(b) False

(8) Income from Capital gains arising out of trading on a stock strange in Pakistan is taxable these days:
[B](a) True[/B]
(b) False

(9) Conversion Cost is calculated as under:
(a) Labour Plus Materials
[B](b) Labour plus overheads[/B]
(c) None of these

(10) Current Ratio can be calculated as under:
(a) Current Liabilities/Current Assets
[B](b) Current Assets/Current Liabilities[/B]
(c) None of these

[QUOTE=omerkhan;392579](8) Deferred Taxation amount be treated as:
(a) Foot note
(b) An item in the Balance Sheet on asset side
(c) None of these

None of these may be the answer because deferred taxation is what you have recognized in your financial statement but not paid to tax authorities, so it should be a liability. But I am not sure.[/QUOTE]

[FONT="Comic Sans MS"]I differ with reason you mentioned because as far as I studied it, Deferred Taxation arises due to difference of depreciation method used by the companies,as in Pakistan Tax authorities recommend companies to use Diminishing balance method and if company is using straight line method then there will be some difference incurred in amount of tax to be paid in starting the difference is Credit but as time passes the difference will start getting Debit or its become receivable..

AS in given question it is not evident that at what point of time they are asking this..but in my view in long run Deferred Tax will be given a Debit Balance means put on asset side...but in starting this shows Credit balance as well it can be liability or asset...so keeping in view these things I too go with [B]part C[/B][/FONT]

[QUOTE](9) Return of Equity will be calculated as under:
(a) Operating Profit x 100/Equity
(b) Net profit x 100/Paid up Capital only
[B](c) None of these[/B]

Return on Equity is calculated as Net Profit/Shareholders' Equity x 100[/QUOTE]

[FONT="Comic Sans MS"]Yup you are right...![/FONT]

[QUOTE=xaara~hussain;392589]

(1) Rent of the premises constitutes variable expenses for cost allocation:
[B](a) True[/B]
(b) False
[/QUOTE]

[FONT="Comic Sans MS"]This is [B]False[/B] because whether you use premises or not, you will have to pay Rent..[/FONT]

[QUOTE=Rixwan;392617][FONT="Comic Sans MS"]This is [B]False[/B] because whether you use premises or not, you will have to pay Rent..[/FONT][/QUOTE]
hmm is it about the expense itself or its value? I mean the expense is fixed but not value.

[QUOTE=xaara~hussain;393434]hmm is it about the expense itself or its value? I mean the expense is fixed but not value.[/QUOTE]

[FONT="Comic Sans MS"]its for both...when you acquire some premises on rent there have always been fixed rent for certain period like in house rent case the agreement is for 11 months and after 11 months the rent will be revised as per agreed rate..and in accounting when you are considering rent you will take in to account the value of rents..you always made entry in numeric terms..but in nature Rent will be termed as Fixed expense with what ever value you paid...

I think you have been taking fixed and Variable expenses with wrong perception..in real

Fixed Expenses are those which you will have to bear whether you do any production or not. It does not mean that value which you pay remain Fixed. e.g if you have acquired some building on rent you will have to pay rent whether you use it or not.

On the contrary, Variable expenses are those expenses which directly related to your production means if you do any production these expenses are high and if you do not produce these expenses are either low or none.
e.g. your material Cost or Labour Cost, If you are going to do any production these costs will incur or else not.

I hope it clears your concept and if not then feel free to ask. :)[/FONT]

[QUOTE=xaara~hussain;391233][CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -I (2000)[/U][/COLOR][/SIZE][/B][/CENTER]

(9) Quick Ratio can be computed as under:
(a) Quick . Assets/Quick Liabilities
(b) Quick . Liabilities Current Assets
[b](c) Current Assets/ Current Liabilities[/b]


(18) Every limited Company in Pakistan is required by law to include the following along with financial reports:
(a) Ratio Analysis
[B](b) Chairman’s Review[/B]
(c) None of these.


[CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -II (2000)[/U][/COLOR][/SIZE][/B][/CENTER]

6. Verification includes:
a. Checking Vouchers
b. Examining audit report
[B]c. None of the above[/B]

[/QUOTE]

(9) Quick Ratio can be computed as under:
[COLOR="DarkGreen"](a) Quick . Assets/Quick Liabilities[/COLOR]
(b) Quick . Liabilities Current Assets
(c) Current Assets/ Current Liabilities

(18) Every limited Company in Pakistan is required by law to include the following along with financial reports:
(a) Ratio Analysis
(b) Chairman’s Review
[COLOR="DarkGreen"](c) None of these.[/COLOR]

6. Verification includes:
[COLOR="DarkGreen"]a. Checking Vouchers[/COLOR]
b. Examining audit report
c. None of the above

[QUOTE=xaara~hussain;392340][COLOR=seagreen][CENTER][U][B][SIZE=5]Accounting & Auditing Paper-I (2002)[/SIZE][/B][/U][/CENTER]
[/COLOR]

(7) Preparation of annual report of a firm is governed under:
(a) Partnership Act 1932
(b) Under partnership Deed
[B](c) None of these[/B]

[/QUOTE]

please share reasoning...

[QUOTE=dawoodahmad;570690](9) Quick Ratio can be computed as under:
[COLOR=DarkGreen](a) Quick . Assets/Quick Liabilities[/COLOR]
(b) Quick . Liabilities Current Assets
(c) Current Assets/ Current Liabilities

(18) Every limited Company in Pakistan is required by law to include the following along with financial reports:
(a) Ratio Analysis
(b) Chairman’s Review
[COLOR=DarkGreen](c) None of these.[/COLOR]

6. Verification includes:
[COLOR=DarkGreen]a. Checking Vouchers[/COLOR]
b. Examining audit report
c. None of the above[/QUOTE]
quick ratio= quick assets/current liabilities
there is no such option so i second dawoodahmad that best possible answer should b option (a)

[quote](3) Work Sheet is:
(a) Balance Sheet
(b) Fund Flows Statement
(c) A combination of Profit and Loss Account and Balance Sheet items
(d) None of these[quote]

answer should b none of these

Correction
 

[QUOTE=Saba Yasmin;611404]

Work Sheet is:
(a) Balance Sheet
(b) Fund Flows Statement
(c) A combination of Profit and Loss Account and Balance Sheet items
(d) None of these

answer should b none of these[/QUOTE]

A worksheet in accounting comprises of P&L and Balance Sheet balances both adjusted and un-adjusted.[B]Option (c) is correctly marked in original post[/B]. Option (d) is wrong answer.

confirmation
 

Hi Can anyone please recheck answer of question 7 ?

[QUOTE=xaara~hussain;391233][CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -I (2000)[/U][/COLOR][/SIZE][/B][/CENTER]

(1) Double entry book-keeping was fathered by:
(a) F.W.Taylor
(b) Henry Fayol
[B](c) Lucas Pacioli.[/B]

(2) Funds Flow Statement and sources and application statement are:’
[B](a) Synonymous [/B]
(b) Antagonistic
(c) None of these.

(3) Depreciation in spirit is similar to:
(a) Depletion
[B](b) Amortization [/B]
(c) Depression.

4) Balance Sheet is always prepared:
(a) for the year ended.
[B](b) As on a specified date. [/B]
(c) None of these.

(5) In Insurance, the following Profit and Loss Accounts are prepared:
(a) Separate for Fire, Marine, and Accidents etc.
[B](b) Consolidated for Fire, Marine, and Accidents etc.[/B](c) None of these.

(6) Partners in Pakistan can today be fixed at the following numbers:
[B](a) 20 [/B]
(b) 50
(c) 75.

(7) Flexible budget is a budget with the following features:
[B](a) Changes with volume of production.[/B]
(b) Changes with variable expenses
(c) Changes in Direct material.

(8) Break Even can be calculated as under:
(a) ______VC_______
FC- TR TC
[B](b) FC
I- VC TR[/B](c) None of these.

(9) Quick Ratio can be computed as under:
(a) Quick . Assets/Quick Liabilities
(b) Quick . Liabilities Current Assets
[b](c) Current Assets/ Current Liabilities[/b]

(10) In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under:
(a) Rupee one
[B](b) Rupee zero [/B](c) None of these.

(11) Sales budget must be prepared:
(a) Independently
(b) Depending on production capacity
[B](c) Based on Sales forecasts of market. [/B]

(12) Consolidation of subsidiary accounts in the balance sheet of a unlisted Holding company is at present in Pakistan:
(a) Compulsory
(b) Voluntary
[B](c) Required. [/B]

(13) Retained earning is synonymous to:
[B](a) Accumulated profit and loss account[/B]
(b) Profit for the year
(c) None of these.

(14) The requirements of an audit report for a Banking Company in Pakistan is under:
(a) Under the Banking Companies Ordinance, 1962.
(b) Under the Companies Ordinance, 1984.
[B](c) Under (a) and (b) above.[/B]

(15) Deferred Taxation is:
(a) Fixed asset
(b) Fixed liabilities
[B](c) Part of Owners Equity.[/B]

(16) Investment Corporation of Pakistan follows:
(a) Open-end mutual funds
(b) Closed-end mutual funds
[B](c) None of these.[/B]

(17) Directors Report is ---- in respect of financial report constituent.
[B](a) Mandatory for a limited Company[/B]
(b) Voluntary for a limited Company
(c) None of these.

(18) Every limited Company in Pakistan is required by law to include the following along with financial reports:
(a) Ratio Analysis
[B](b) Chairman’s Review[/B]
(c) None of these.

(19) Cash budget excludes the following:
[B](a) Non-Cash items[/B]
(b) Cash items
(c) Purchase on Credit items.

(20) NGOs are legally required to:
[B](a) Prepare accounts in a prescribed manner under the law.[/B](b) Prepare accounts as desired by donors.
(c) None of these.




[CENTER][B][SIZE="4"][COLOR="Purple"][U]Accounting & Auditing Paper -II (2000)[/U][/COLOR][/SIZE][/B][/CENTER]


1. Fixed Cost:
a. Changes with production
[B]b. Never changes even if production capacity is doubled[/B]
c. None of the above

2. Conversion cost is:
a. Material Cost + Overhead Cost
b. Direct Labour + Material Cost
[B]c. Labour Cost + Overhead Cost[/B]

3. Process Costing is relevant to:
[B]a. Cement industry[/B]
b. Job Order cost oriented Projects
c. None of the above

4. Operating Profit is:
a. Profit after deducting financial costs
b. Profit after deducting taxes
[B]c. Profit after deducting normal operating expenses including depreciation[/B]

5. A good Cost Accounting System is:
a. If it computes estimated cost only
b. If it cannot be reconciled with financial accounts
[B]c. If it enables management to increase productivity and rationalize cost structure[/B]

6. Verification includes:
a. Checking Vouchers
b. Examining audit report
[B]c. None of the above[/B]

7. Stratified audit sample means:
[B]a. Randomly selected items for audit[/B]
b. Purposively selected items for audit
c. Items carefully selected from each group

8. Internal Control is totally synonymous with:
a. Internal check
b. Internal audit
[B]c. None of above[/B]

9. Audit of a bank is generally conducted through:
[B]a. Routine checking[/B]
b. Couching
c. Balance sheet audit

10. An auditor is liable for his annual audit of accounts o:
a. Creditors
b. Bankers
[B]c. Owners[/B]

11. Income Tax is levied on:
a. Agricultural Income
[B]b. Presumptive Income[/B]
c. None of above

12. If a firm has paid super-tax, its partners may follow any one of the following behaviours:
a. No need to pay income tax, even if the income exceeds the taxable limit.
b. Pay income tax, even if the income does not exceed the taxable income.
[B]c. Pay income tax as required under the law.[/B]

13. A resident multinational company need not:
a. Pay income tax, if it s caused under Double Taxation agreement.
b. If it is not enjoying tax exemption under the Income Tax Ordinance, 1979 (Second Schedule).
[B]c. None of above[/B]

14. Income Tax rates are the same for:
a. Limited Companies
[B]b. Banking Companies[/B]
c. None of above

15. Super Tax on companies is:
a. In vogue in Pakistan
[B]b. Not in vogue in Pakistan[/B]
c. None of above

16. Current Ratio is calculated as:
a. Fixed Assets/Current Liabilities
b. Current Liabilities/Current Assets
[B]c. Current Assets/Current Liabilities[/B]

17. Short-term loan can be described as:
a. If the period is three years
[B]b. If the period is less than one year[/B]
c. If the period is over one year

18. A partnership, in today’s Pakistan, under the current law can have the following number of partners:
a. 50
[B]b. 20[/B]
c. 100

19. Combination can be best described as:
a. Restructuring of Capital of a Company
b. Reduction of Capital of a Company
[B]c. Amalgamation of two different types of businesses[/B]

20. Sources of funds can be increased by:
a. Describing selling prices
b. Increasing expenditure
[B]c. None of above [/B][/QUOTE]

(19) Economics resources of a business that are expected to be of benefit in the future are referred to as:
(a) Liabilities
[B](b) Owner’s equity[/B]
(c) Withdrawals
[COLOR="SeaGreen"](d) Assets[/COLOR]
(e) None of these


Xara Hussain to me they are Assets the answer is D. what u say?

MCQ's Accounting & Auditing Paper -I (2013)
 

[CENTER][COLOR=Sienna][B][U][SIZE=4]Accounting & Auditing Paper -I (2013)
[/SIZE][/U][/B][/COLOR][LEFT]
[CENTER][B][FONT=&quot]PART-I ((MCQs) (COMPULSORY)[/FONT][/B]

[/CENTER]
[B][FONT=&quot]Q.1. (i) [/FONT][/B][FONT=&quot]Select the best option/answer and fill in the appropriate Circle on the [B]OMR Answer Sheet. (20x1=20)[/B][/FONT]
[B][FONT=&quot](ii) [/FONT][/B][FONT=&quot]Answers given anywhere, other than OMR Answer Sheet, shall not be considered.[/FONT]

[SIZE=4]
[B][FONT=&quot]1. [/FONT][/B][FONT=&quot]Double Entry Book Keeping was fathered by:[/FONT][COLOR=DarkOrchid]
[B][FONT=&quot](a) [/FONT][/B][B][FONT=&quot]Luca Paioli[/FONT][/B][/COLOR][B][FONT=&quot] [B](b) [/B][/FONT][/B][FONT=&quot]Yoyji Ijiri [B](c) [/B]Micheal Hammer [B](d) [/B]Ishikawa[/FONT]

[SIZE=2]http://en.wikipedia.org/wiki/Double-entry_bookkeeping_system
It was first codified in the 15th century by the Franciscan friar [URL="http://en.wikipedia.org/wiki/Luca_Pacioli"]Luca Pacioli[/URL].

[/SIZE]
[B][FONT=&quot]2. [/FONT][/B][FONT=&quot]Accumulated loss of a company is shown in the balance sheet as:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Liability [COLOR=DarkOrchid][B](b) [/B][B]As an asset[/B][/COLOR] [B](c) [/B]As foot note to balance sheet [B](d) [/B]None of these[/FONT]

[SIZE=2]Profit is recognized on Credit side while Losses on Debit side.
[URL]http://www.indiastudychannel.com/experts/9625-Why-Accumulated-Losses-are-treated-an-Assets.aspx[/URL]
[/SIZE]

[B][FONT=&quot]3. [/FONT][/B][FONT=&quot]Under the Companies Ordinance 1984, disclosure of financial information is legally required for listed companies[/FONT]
[FONT=&quot]under:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Schedule 6 [B](b) [/B]Schedule 5 [COLOR=DarkOrchid][B](c) Schedule 4[/B][/COLOR] [B](d) [/B]Schedule 8

[URL]http://www.secp.gov.pk/corporatelaws/pdf/Comp_Ord1984.pdf[/URL]
[/FONT]

[B][FONT=&quot]4. [/FONT][/B][FONT=&quot]A company is considered sick under the Companies Ordinance 1984 where current ratio is:[/FONT]
[COLOR=DarkOrchid][B][FONT=&quot](a) [/FONT][/B][/COLOR][FONT=&quot][COLOR=DarkOrchid][B]Below 0.5 : 1[/B][/COLOR] [B](b) [/B]Below 3 : 1 [B](c) [/B]Above 2.5 : 1 [B](d) [/B]None of these[/FONT]
[B][FONT=&quot]
[/FONT][/B][SIZE=2]Section 295 (d)(iii) CO1984
[URL]http://www.secp.gov.pk/corporatelaws/pdf/Comp_Ord1984.pdf[/URL]
[B][FONT=&quot](iii) current ratio has deteriorated beyond 0.5 :1
[/FONT][/B][/SIZE]

[B][FONT=&quot]5. [/FONT][/B][FONT=&quot]Banks are required to prepare their financial statements as per following legislation:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Free to prepare with no legislative requirements [B](b) [/B]Under Companies Ordinance 1984[/FONT]
[COLOR=DarkOrchid][B][FONT=&quot](c) [/FONT][/B][/COLOR][FONT=&quot][COLOR=DarkOrchid][B]Banking Ordinance 1962[/B][/COLOR] [B](d) [/B]State Bank Laws[/FONT]
[B][FONT=&quot]
[/FONT][/B][SIZE=2]http://www.sbp.org.pk/bsd/2001/C36.htm
[/SIZE][FONT=Verdana, Arial, Helvetica, sans-serif][COLOR=#000066][SIZE=2]In terms of Section 34 of the Banking Companies Ordinance, 1962 the banks are required to prepare their annual accounts in the forms set out in the Second Schedule to the said Ordinance.
[/SIZE]

[/COLOR][/FONT] [B][FONT=&quot]6. [/FONT][/B][FONT=&quot]Preparation of financial statement of listed insurance companies in Pakistan is governed by:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Insurance Act 1938 [COLOR=DarkOrchid][B](b) Insurance Ordinance 2000[/B][/COLOR] [B](c) [/B]Companies Act 1913 [B](d) [/B]Companies Ordinance 1984[/FONT]
[B][FONT=&quot]
[/FONT][/B][/SIZE]http://www.pgi.com.pk/pdfs/annual2012_PGI%20annual%202012.pdf
[SIZE=2]http://www.pgi.com.pk/pdfs/halfyearly2006.pdf

BASIS OF PRESENTATION [/SIZE][FONT=sans-serif][SIZE=2]The financial statements have been prepared in accordance with the requirements of accounting regulations laid down by the SECP (Insurance Rules, 2002) of the Insurance Ordinance, 2000.
[/SIZE][SIZE=2]Insurance Ordinance, 2000 (Primarily), CO1984 (secondary).
[/SIZE][/FONT]
[SIZE=4]
[B][FONT=&quot]7. [/FONT][/B][FONT=&quot]Trading loss occurs when:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Revenues exceed the matching relevant costs. [B](b) [/B]Revenue and matching costs are equal to each other.[/FONT]
[B][COLOR=DarkOrchid][FONT=&quot](c) [/FONT][/COLOR][/B][FONT=&quot][B][COLOR=DarkOrchid]When relevant matching cost exceeds revenues[/COLOR][/B] [B](d) [/B]None of these[/FONT]
[B][FONT=&quot]
[/FONT][/B][SIZE=2]Simple, when cost (e.g. Rs. 100) is greater than Revenue (e.g. Rs. 80), then loss (of Rs. 20) will occur.
Furthermore, See matching concept also.
Generally, while making financial statements only those costs are undertaken which MATCHES to the accounting period in which the Matched Revenue was generated.
[/SIZE]

[B][FONT=&quot]8. [/FONT][/B][FONT=&quot]Accounting requirements governing NGOs are prescribed in:[/FONT]
[B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Partnership Act 1932 [COLOR=DarkOrchid][B](b) Cooperative societies legislation[/B][/COLOR] [B](c) [/B]Companies Ordinance 1984 [B](d) [/B]None of these[/FONT]
[B][FONT=&quot]
[/FONT][/B][SIZE=2]http://www.asp.org.pk/indepth/csos_covernance_resources/2.pdf
[/SIZE][/SIZE][SIZE=2]There are between 10 to 18[/SIZE][SIZE=2] different laws in Pakistan that may govern [/SIZE][SIZE=2]an NGO.
[/SIZE][SIZE=2][FONT=Times New Roman]
[/FONT][/SIZE]
[SIZE=2]THE CO-OPERATIVE SOCIETIES ACT, 1925[/SIZE]

[FONT=Times New Roman][SIZE=2]71. Rules.– (2) (h)
prescribe the accounts and the books to be kept by a society and provide for the audit of such accounts,.......[/SIZE][/FONT][SIZE=4][FONT=Times New Roman][SIZE=2]
CO1984 does not apply as per sec 4(i) of CO1984
PA 1932 Sec 4 defines partnership, while NGO's are not businesses for sharing profit/losses.
[/SIZE][/FONT][FONT=&quot][SIZE=2]
[/SIZE][/FONT]
[B][FONT=&quot]9. [/FONT][/B][FONT=&quot]Work sheet is equivalent to:[/FONT]
[/SIZE] [SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Balance sheet [B](b) [/B]Income statement [COLOR=DarkOrchid][B](c) Trial Balance[/B][/COLOR] [B](d) [/B]None of these[/FONT][/SIZE]

[SIZE=2][FONT=&quot]Basically, Work Sheet is the SUM of [/FONT][FONT=&quot]Balance sheet,Income statement andTrial Balance. BUT nature of worksheet is of Trial Balance.
[/FONT][/SIZE]

[SIZE=2]http://www.wisegeek.com/what-is-a-trial-balance.htm[/SIZE]
[SIZE=2]The trial balance is an accounting listing that shows the beginning and ending balances for all accounts included in the set of books. [B]This worksheet format[/B] makes it possible to evaluate whether or not the total debits for the period cited are in balance with the total number of credits generated for the same period. When a true trial balance exists, the total credits and total debits will be equal.[/SIZE]
[SIZE=2]
[/SIZE]
[SIZE=4][B][FONT=&quot]10. [/FONT][/B][FONT=&quot]Work sheet does include:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Fund flows statement [B](b) [/B]Cash gensation statement [B](c) [/B]Cash flow statement [COLOR=DarkOrchid][B](d) None of these[/B][/COLOR][/FONT][/SIZE]

[SIZE=2][FONT=&quot]Work Sheet is the SUM of [/FONT][FONT=&quot]Balance sheet,Income statement andTrial Balance formats.
[/FONT][/SIZE]

[SIZE=4][B][FONT=&quot]11. [/FONT][/B][FONT=&quot]Deffered tax is shown in the balance sheet as:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Liability [B](b) [/B]Asset [COLOR=DarkOrchid][B](c) An expenditure in income statement[/B][/COLOR] [B](d) [/B]None of these[/FONT][/SIZE]

No Doubt, its controversial.:haha :haha ****Deferred**** not "Deffered" :laughing :laughing :laughing

Can be asset or liability.

Para 58 IAS 12
Current and deferred tax shall be recognised as income or an expense and included in profit or loss for the period.....

Whatever the amount of Deferred tax is shown in the balance sheet, it is shown as in the Expenditure section of Income statement under the head Taxation, along with the current tax.


[SIZE=4][B][FONT=&quot]12. [/FONT][/B][FONT=&quot]The following represent tangible assets and are shown in the balance sheet as:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]People [B](b) [/B]Expenses [B](c) [/B]Revenue [B][COLOR=DarkOrchid](d) Goodwill[/COLOR][/B][/FONT][/SIZE]
[SIZE=4][B][FONT=&quot]
[/FONT][/B][/SIZE]
It should be INtangible.
option a,b,c are irrelevant as they cannot be shown on Balance Sheet. :D


[SIZE=4][B][FONT=&quot]13. [/FONT][/B][FONT=&quot]Under the Rule of thumb a good current ratio is:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]6 : 1 [B](b) [/B]10 : 1 [B](c) [/B].05 : 1 [B][COLOR=DarkOrchid](d) 2 : 1[/COLOR][/B][/FONT][/SIZE]

[SIZE=2]http://www.encyclopediaofcredit.com/Working-Capital
[/SIZE]
[SIZE=2][B][I]Current Ratio[/I][/B][B]:[/B] The current ratio gauges how capable a business is in paying current liabilities by using current assets only. Current ratio is also called the working capital ratio. A general rule of thumb for the current ratio is 2 to 1 (or 2:1 or 2/1).
[/SIZE]

[SIZE=4][B][FONT=&quot]14. [/FONT][/B][FONT=&quot]Financial analysis is a legislative requirement under:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Companies Ordinance 1984 [B](b) [/B]Partnership Act 1932 [B](c) [/B]Voluntary act [COLOR=DarkOrchid][B](d) None of these[/B][/COLOR][/FONT][/SIZE]

CO84 & PA32 does not contain the word "analysis".
No Voluntary Act exists in Pakistan.

Generally financial statements in Pakistan does not contain any sort of analysis.
[SIZE=4][B][FONT=&quot]
[/FONT][/B][/SIZE]
[SIZE=4][B][FONT=&quot]15. [/FONT][/B][FONT=&quot]Pakistan follows the following budgeting system at Federal level:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Zero-Based Budgeting [B](b) [/B]Program Budgeting[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](c) [/FONT][/B][FONT=&quot]Responsibility Budgeting [COLOR=DarkOrchid][B](d) Incremental / decremental budgeting[/B][/COLOR][/FONT][/SIZE]

[SIZE=2][B][FONT=&quot]http://www.grbi.gov.pk/Documents/BudgetaryReform.pdf[/FONT][/B][/SIZE]
[SIZE=2][B][FONT=&quot]pg 31[/FONT][/B][/SIZE]
[SIZE=2]The recurrent budget estimates are prepared on incremental basis.[/SIZE]
[SIZE=4][B][FONT=&quot]
[/FONT][/B][/SIZE]
[SIZE=4][B][FONT=&quot]16. [/FONT][/B][FONT=&quot]Preparation of budget by a company is compulsory under:[/FONT][/SIZE]
[SIZE=4][B][COLOR=DarkOrchid][FONT=&quot](a) [/FONT][/COLOR][/B][FONT=&quot][B][COLOR=DarkOrchid]No Law[/COLOR][/B] [B](b) [/B]Several laws [B](c) [/B]Securities & Exchange Ordinance 1969 [B](d) [/B]Companies Ordinance 1984[/FONT][/SIZE]

[SIZE=4][FONT=&quot][SIZE=2]CO84 & SEO69 does not require any budget preparation.[/SIZE][/FONT][B][FONT=&quot]
[/FONT][/B][/SIZE]

[SIZE=4][B][FONT=&quot]17. [/FONT][/B][FONT=&quot]Depreciation must be accounted for:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Revenues [COLOR=DarkOrchid][B](b) Fixed Assets[/B][/COLOR] [B](c) [/B]Share Capital [B](d) [/B]None of these[/FONT][/SIZE]

Revenue and Share capital are not tangible items for which depreciation is calculated.
[SIZE=4][B][FONT=&quot]
[/FONT][/B][/SIZE]
[SIZE=4][B][FONT=&quot]18. [/FONT][/B][FONT=&quot]Accelerated depreciation is allowed under:[/FONT][/SIZE]
[SIZE=4][COLOR=DarkOrchid][B][FONT=&quot](a) [/FONT][/B][/COLOR][FONT=&quot][COLOR=DarkOrchid][B]Income Tax Ordinance 2001[/B][/COLOR] [B](b) [/B]Voluntary principals [B](c) [/B]Prudential Regulations [B](d) [/B]None of these[/FONT][/SIZE]

[SIZE=2][FONT=Arial]Section [/FONT][/SIZE][FONT=Arial][SIZE=2][FONT=&quot][[B][B]23B. Accelerated depreciation to alternate energy projects.[/B][/B][/FONT][/SIZE][/FONT]


[SIZE=4][B][FONT=&quot]19. [/FONT][/B][FONT=&quot]Partnerships are legally required to prepare their financial statements for distribution on wide basis under:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]Partnerships Act 1932 [B](b) [/B]Securities & Exchange Rules 2000[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](c) [/FONT][/B][FONT=&quot]Voluntary Act for Compliance [B][COLOR=DarkOrchid](d) None of these[/COLOR][/B][/FONT][/SIZE][B][COLOR=DarkOrchid]
[/COLOR][/B][SIZE=4][B][FONT=&quot]
[/FONT][/B][/SIZE]Partnerships are not legally required for FS especially to be distributed on wide basis.

[SIZE=4][B][FONT=&quot]20. [/FONT][/B][FONT=&quot]A company is considered sick if the market value compared to its par value is:[/FONT][/SIZE]
[SIZE=4][B][FONT=&quot](a) [/FONT][/B][FONT=&quot]1 : 1 [B](b) [/B]2 : 1 [COLOR=DarkOrchid][B](c) 0.25 : 1[/B][/COLOR] [B](d) [/B]None of these[/FONT][/SIZE]
[SIZE=1]

[/SIZE][SIZE=4][SIZE=2]Section 295 (d)(i) CO1984
[URL]http://www.secp.gov.pk/corporatelaws/pdf/Comp_Ord1984.pdf[/URL]

the market value of its shares as quoted on the stock exchange or the net worth of its share has fallen by more than seventy-five per cent of its par value
if 75% fall in par then value will remain 25% i.e. 0.25 to 1
[/SIZE][/SIZE] [/LEFT]
[/CENTER]

Lets Solve MCQ'S paper Accounting and Auditing 1999
 

[SIZE="5"][CENTER]Paper 1 [/CENTER][/SIZE]
(1) Accounting principles are generally based on
(a) Practicability (b) Subjectivity (c) Convenience in recording
(2) Real accounts are related to
(a) Assets (b) Expense and incomes (c) Customers and creditor etc
(3) Rent paid to the land lord should be credited to
(a) Landlord Account (b) Rent account (c) Cash Account
4) In the event of dissolution of a partnership firm the provision for doubtful debts is transferred to
(a) Realization Account (b) Partner capital accounts (c) sundry debtors Accounts
(5) A prospectus for share can be issued only by
(a) A public company (b) A private company (c) None of these.
(6) Preliminary expense is
(a) Current asset (b) Current Liability (c) Fictitious asset
(7) The valuation of closing stock is at
(a) Cost price (b) Market price
(c) Cost or Market price whichever is lower
(8) The master budget includes
(a) as income statement (b) a balance sheet (c) a cash budget (d) all of these
(9) Cost volume profit analysis is the method used to estimate the impact on profit is of changes in
(a) Unit variable cost (b) unit sales price (c) Sale volume (d) All of these
(10) In a manufacturing company product cost include
(a) Material cost only (b) Material and labour (c) Labour cost only (d) material labour and overhead cost
(11) A liability in the amount of Rs 500 is paid in cash which of the fallowing is true
(a) Asset is increased and liability is decreased (b) Asset is increased and liability is increased
(b) Asset is decreased and liability is decreased (b) Liability is decreased and owner’s equity is increased
(12) Which one of the following account would usually have credit balance?
(a) Cash (b) Account payable (c) Equipment (d) Salaries expense
(13) A company collected one year’s rent in advance on October 1st ,1997 the entries Rs 1200 was credited to unearned revenue account the adjusting entry at the December 31,1997 year ended would include
(a) A debit to unearned revenue for Rs 300 (b) A debit to unearned revenue for Rs 900 (c) A credit to unearned revenue for Rs 300 (d) A debit to rent earned for Rs 900
(14) Net income plus operating expense is equal to
(a) Net sale (b) Cost of good available for sales (c) Cost of good sold (d) Gross profit
(15) When purchase merchandise is returned under a perpetual inventory system a credit would be made to
(a) Inventory (b) Freight in (c) Purchases (d) Purchase return
(16) Which of the fallowing accounts would not be included in the computation of the cost of goods sold
(a) Purchase returns (b) Freight in (c) Purchase discount lost (d) Purchase discounts
(17) Total manufacturing cost for a period includes all of the fallowing except
(a) Raw material used (b) Direct labour cost
(c) Cost of good completed (d) Factory overhead cost
(18) Quick Asset includes which of the fallowing
(a) Cash (b) Account receivable (c) Marketable securities (d) All of these (e) a &b
(19) When a small stock dividend is declared which of the fallowing accounts is credited
(a) Common stock (b) Dividend payable (c) Common stock dividend distributable (d)Retained Earnings
(20) An advantages of the partnership from of business organization is its
(a) Unlimited liability (b) Mutual agency (c) Ease of the formation (d) Limited life
[B][CENTER][SIZE="5"][SIZE="5"]CSS 1999 PAER 2nd [/SIZE][/SIZE][/CENTER][/B]
(1) The table “ A “of the Companies Ordinance 1984
(a) Balance sheet format (b) Profit & Loss format (c) Model “ Articles of Association” (d) Model “Memorandum of Association”
(2) The statement of assets liabilities and owner’s capital is called the
(a) Financial statement (b) Profit & loss A/c (c) Balance sheet (d) statement of owners capital
(3) When business activity increases the fixed cost per unit
(a) Decreased (b) Remain the same (c) Increases (d) None of these
4) Standard cost are not used to
(a) Measuring the performance (b) Prepare Budgets (c) Aid in planning (d) Avoid tracking actual costs
(5) Return on investment could be improved by
(a) Increasing assets turnover (b) Decreasing return on sales (c) Decreasing contribution margin (d) Increasing control expense
(6) The formula a future value of dollar is
(a) P (1 + r )n (b) P (1 - r )n (c) P (1 + n)r (d) P (r -1 )n
(7) The analysis of financial statement helps identify a company’s strengths and weaknesses it indicate if company
(a) is managing its inventory efficiently (b) Has sufficient plant assets
(c) is collecting accounts receivable quickly (d) All of the above
(8) Company’s earning power ratios are of a great interest to
(a) Preferred shareholders (b) Long terms lenders (c) Common share holders (d) all of these
(9) Depreciation Expense is
(a) a cash inflow (b) a cash outflow (c) Ignored when proper cash flow statements (d) Added to the accumulated depreciation account
(10) An increase in income tax payable mean that the company
(a) Paid less than the income tax expense repotted (b) Paid more than the income tax expense reported (c) Paid the same as the income tax expense reported (d) Is not paying any income taxes
(11) A Cash sale of merchandise should be recorded in the
(a) Sales journal (b) General Journal (c) Cash receipt journal (b) Cash payment journal
(12) Which of the fallowing should not be considered cash by an accountant?
(a) Money Order (b) Bank saving account balance (c) Postage stamps (d) Travelers’ cheques
(13) The inventory method that assigns the most recent costs to the cost of goods sold is
(a) FIFO (b) LIFO (c) Weight average (d) Specific Identification
(14) In finance Working capital means the same things as
(a) Total assets (b) Fixed assets (c) Current assets (d) Current assets minus current liabilities
(15) The more basic requirement for a firm’s marketable securities
(a) Safety (b) yield (c) Marketability
(16) Partnership forms of organization
(a) Avoids the double taxation of earnings and dividends found in the corporate form of a organization (b) Usually provides limited liability to the partners (c) Has unlimited life
(17) A corporate buy back or the repurchasing of share is
(a) An example of balance sheet restructuring (b) An excellent source of profit when the firm stock is overpriced
(c) A method of reducing the debt to equity ratio (d) All of the above
(18) A statement of cash flows can be prepaid using a ful T account analysis This approch
(a) User a detail T accounts for each balance sheet account (b) Dividend the cash T account into cash inflow and cash outflows (c) Classifies item into operating, investing ,financing (d) All the above are true
(19) If the beginning inventory of the finished good is 3000 units, planned sales are 25000 units and planned productions is 27000 units the inventory of finished goods on the budgeted balance sheet would be
(a) 3000 (b) 1000 (c) 5000 (d) None of these
(20) If working capital increased during the period
(a) Current assets must be increased (b) Current liabilities must be decreased (c) Source of working capital must have been greater than uses of working capital (d) User of working capital must have been greater than sources of working capital

paper 1 Answer
Q2 (A) ,3(C) 6(C) 7(C) 8(D) 10 (D) 11(C) 12 (B) 13(A) 14 (D) 15(A) 16(C) 17(C) 18(D) 19(C) 20 (A) If any mistake in my answer tell me we discuss Kindly answer these

Un answered Question 1,4,5,9

paper Q1 (a) , Q 4 (A) Q 5 (A)

[QUOTE=KHANSHAHRUKH;637102]Hi Can anyone please recheck answer of question 7 ?[/QUOTE]

Dear Khan sb...Question No: 7 is correct in both the papers.

[QUOTE=Nouman masood;675562][SIZE="5"][CENTER]Paper 1 [/CENTER][/SIZE]
(1) Accounting principles are generally based on
[B](a) Practicability[/B] (b) Subjectivity (c) Convenience in recording
(2) Real accounts are related to
[B](a) Assets[/B] (b) Expense and incomes (c) Customers and creditor etc
(3) Rent paid to the land lord should be credited to
[B](a) Landlord Account [/B] (b) Rent account (c) Cash Account
4) In the event of dissolution of a partnership firm the provision for doubtful debts is transferred to
[B](a) Realization Account [/B] (b) Partner capital accounts (c) sundry debtors Accounts
(5) A prospectus for share can be issued only by
[B](a) A public company[/B] (b) A private company (c) None of these.
(6) Preliminary expense is
(a) Current asset (b) Current Liability [B](c) Fictitious asset[/B]
(7) The valuation of closing stock is at
(a) Cost price (b) Market price
[B](c) Cost or Market price whichever is lower[/B]
(8) The master budget includes
(a) as income statement (b) a balance sheet (c) a cash budget (d)these [B]all of these[/B]
(9) Cost volume profit analysis is the method used to estimate the impact on profit is of changes in
(a) Unit variable cost (b) unit sales price (c) Sale volume [B](d) All of these[/B]
(10) In a manufacturing company product cost include
(a) Material cost only (b) Material and labour (c) Labour cost only [B] (d) material labour and overhead cost[/B]
(11) A liability in the amount of Rs 500 is paid in cash which of the fallowing is true
(a) Asset is increased and liability is decreased (b) Asset is increased and liability is increased
[B](b) Asset is decreased and liability is decreased[/B] (b) Liability is decreased and owner’s equity is increased
(12) Which one of the following account would usually have credit balance?
[B](a) Cash[/B] (b) Account payable (c) Equipment (d) Salaries expense
(13) A company collected one year’s rent in advance on October 1st ,1997 the entries Rs 1200 was credited to unearned revenue account the adjusting entry at the December 31,1997 year ended would include
[B](a) A debit to unearned revenue for Rs 300[/B] (b) A debit to unearned revenue for Rs 900 (c) A credit to unearned revenue for Rs 300 (d) A debit to rent earned for Rs 900
(14) Net income plus operating expense is equal to
(a) Net sale (b) Cost of good available for sales (c) Cost of good sold [B](d) Gross profit[/B]
(15) When purchase merchandise is returned under a perpetual inventory system a credit would be made to
(a) Inventory (b) Freight in (c) Purchases [B](d) Purchase return[/B]
(16) Which of the fallowing accounts would not be included in the computation of the cost of goods sold
(a) Purchase returns [B](b) Freight in [/B] (c) Purchase discount lost (d) Purchase discounts
(17) Total manufacturing cost for a period includes all of the fallowing except
(a) Raw material used (b) Direct labour cost
(c) Cost of good completed [B](d) Factory overhead cost[/B](18) Quick Asset includes which of the fallowing
(a) Cash (b) Account receivable (c) Marketable securities (d) All of these [B](e) a &b[/B]
(19) When a small stock dividend is declared which of the fallowing accounts is credited
(a) Common stock (b) Dividend payable (c) [B]Common stock dividend distributable[/B] (d)Retained Earnings
(20) An advantages of the partnership from of business organization is its
(a) Unlimited liability [B](b) Mutual agency[/B] (c) Ease of the formation (d) Limited life
[B][CENTER][SIZE="5"][SIZE="5"]CSS 1999 PAER 2nd [/SIZE][/SIZE][/CENTER][/B]
(1) The table “ A “of the Companies Ordinance 1984
(a) Balance sheet format (b) Profit & Loss format (c) [B]Model “ Articles of Association”[/B] (d) Model “Memorandum of Association”
(2) The statement of assets liabilities and owner’s capital is called the
(a) Financial statement (b) Profit & loss A/c [B](c) Balance sheet[/B] (d) statement of owners capital
(3) When business activity increases the fixed cost per unit
(a) Decreased [B](b) Remain the same[/B] (c) Increases (d) None of these
4) Standard cost are not used to
(a) Measuring the performance (b) Prepare Budgets [B](c) Aid in planning[/B] (d) Avoid tracking actual costs
(5) Return on investment could be improved by
[B](a) Increasing assets turnover[/B] (b) Decreasing return on sales (c) Decreasing contribution margin (d) Increasing control expense
(6) The formula a future value of dollar is
[B](a) P (1 + r )n [/B] (b) P (1 - r )n (c) P (1 + n)r (d) P (r -1 )n
(7) The analysis of financial statement helps identify a company’s strengths and weaknesses it indicate if company
(a) is managing its inventory efficiently (b) Has sufficient plant assets
(c) is collecting accounts receivable quickly [B](d) All of the above[/B]
(8) Company’s earning power ratios are of a great interest to
(a) Preferred shareholders (b) Long terms lenders [B](c) Common share holders [/B] (d) all of these
(9) Depreciation Expense is
(a) a cash inflow (b) a cash outflow (c) Ignored when proper cash flow statements [B](d) Added to the accumulated depreciation account[/B]
(10) An increase in income tax payable mean that the company
[B](a) Paid less than the income tax expense repotted[/B] (b) Paid more than the income tax expense reported (c) Paid the same as the income tax expense reported (d) Is not paying any income taxes
(11) A Cash sale of merchandise should be recorded in the
(a) Sales journal (b) General Journal [B](c) Cash receipt journal[/B] (b) Cash payment journal
(12) Which of the fallowing should not be considered cash by an accountant?
(a) Money Order (b) Bank saving account balance (c) [B]Postage stamps[/B] (d) Travelers’ cheques
(13) The inventory method that assigns the most recent costs to the cost of goods sold is
[B](a) FIFO[/B] (b) LIFO (c) Weight average (d) Specific Identification
(14) In finance Working capital means the same things as
(a) Total assets (b) Fixed assets (c) Current assets [B] (d) Current assets minus current liabilities[/B]
(15) The more basic requirement for a firm’s marketable securities
(a) Safety [B](b) yield [/B] (c) Marketability
(16) Partnership forms of organization
([B]a) Avoids the double taxation of earnings and dividends found in the corporate form of a organization[/B] (b) Usually provides limited liability to the partners (c) Has unlimited life
(17) A corporate buy back or the repurchasing of share is
(a) An example of balance sheet restructuring (b) An excellent source of profit when the firm stock is overpriced
([B]c) A method of reducing the debt to equity ratio[/B] (d) All of the above
(18) A statement of cash flows can be prepaid using a ful T account analysis This approch
[B](a) User a detail T accounts for each balance sheet account [/B] (b) Dividend the cash T account into cash inflow and cash outflows (c) Classifies item into operating, investing ,financing (d) All the above are true
(19) If the beginning inventory of the finished good is 3000 units, planned sales are 25000 units and planned productions is 27000 units the inventory of finished goods on the budgeted balance sheet would be
(a) 3000 [B](b) 1000[/B] (c) 5000 (d) None of these
(20) If working capital increased during the period
[B](a) Current assets must be increased [/B] (b) Current liabilities must be decreased (c) Source of working capital must have been greater than uses of working capital (d) User of working capital must have been greater than sources of working capital[/QUOTE]

I have tried to solve the questions as per my knowledge...All the seniors are requested to correct my errors...Please

in my opinion
(4) At break-even point of 400 units sold the variable costs were Rs. 400 and the fixed costs were Rs.200. What will be the 401 units sold contributing to profit before income tax?
(a) Rs. 0.00
(b) Rs. 0.50
(c) Rs. 1.00
(d) Rs. 1.50
(e) None of these

the ans should be (c) re. 1

Subject selection 2016
 

Please suggest is it accounting a good choice for 2016?

[QUOTE=zaaraqutab;807963]Please suggest is it accounting a good choice for 2016?[/QUOTE]
If you have background of accounting and cmmond over accounting then it is very good choice and very scrong subject.

[QUOTE=zaaraqutab;807963]Please suggest is it accounting a good choice for 2016?[/QUOTE]

If you have any other better option, you need not opt accounting and auditing. This subject is totally unpredictable ...

Subject selection 2016
 

The accounting market has so much saturated and there is no more space.
So it is better to do something different.
But if you have a keen interest in it. Then you should do it. Because nothing is impossible in this world if you have the courage to achieve it.

accounting and auditing
 

i honestly recomend all aspirants not to opt accounting and auditing because paper pattern is not so clear and couese work is very lengthy. so you had better opt any other subject in its place.

Paper-1 (2000) Mcq 4 answer is "c"

We practice in Chartered Accountancy and describe as per IAS as follows,
Balance sheet as at 31 December, 2015
Profit and loss as on 31 December, 2015

I didn't review all Mcqs.

Hello Dear, Accounting is high scoring subject and easy. However, it depends person to person.

paper -1 (10) In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under:
(a) Rupee one
[B](b) Rupee zero[/B] (c) None of these.

Answer is "C"

Reason: Depreciable amount is divide by useful life. Depreciable amount means the amount which is to be depreciated and is calculated as cost less residual value.

[QUOTE=Zubair Gilgiti;910668]paper -1 (10) In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under:
(a) Rupee one
[B](b) Rupee zero[/B] (c) None of these.

Answer is "C"

Reason: Depreciable amount is divide by useful life. Depreciable amount means the amount which is to be depreciated and is calculated as cost less residual value.[/QUOTE]
Please suggest book for audiying

Sent from my SM-G355H using Tapatalk

thanks

accounting and auditing suggestion
 

can someone tell me about accounting and auditing subjects and second from where to start it ?

mcqs
 

respected concerns
I realy appreciate your kind endevors to to provide such a sufficient information regarding various subjects, you are profoundly requested here to kindly provide me past mcqs test papers with answers regarding the post of senior auditor recently annouced by fpsc as I have already qualified writen exam for mentioned post
kazim
03133606866

[QUOTE=Malcus;637978](19) Economics resources of a business that are expected to be of benefit in the future are referred to as:
(a) Liabilities
[B](b) Owner’s equity[/B]
(c) Withdrawals
[COLOR="SeaGreen"](d) Assets[/COLOR]
(e) None of these


Xara Hussain to me they are Assets the answer is D. what u say?[/QUOTE]
The answer is D without any doubt.

If you can't get the ball, get the man!

Please upload recent papers of Accounting and Auditing

[QUOTE=NASSEEM;751860]I have tried to solve the questions as per my knowledge...All the seniors are requested to correct my errors...Please[/QUOTE]

(19) If the beginning inventory of the finished good is 3000 units, planned sales are 25000 units and planned productions is 27000 units the inventory of finished goods on the budgeted balance sheet would be
(a) 3000 (b) 1000 (c) 5000 (d) None of these

Correct answer is 5000:bow

hey would you like to tell me how you solved this question

[QUOTE=angelic taurus;941645]hey would you like to tell me how you solved this question[/QUOTE]
Opening 3000
add Production 27000
Available for sale 30000
Less sale 25000
Closing 5000

Correct answer of this question is option (a) instead of (d)
(15) When purchase merchandise is returned under a perpetual inventory system a credit would be made to
[B](a) Inventory[/B] (b) Freight in (c) Purchases (d) Purchase return

Correct answer of this question is option (b) instead of (a)
12) Which one of the following account would usually have credit balance?
(a) Cash [B](b) Account payable[/B] (c) Equipment (d) Salaries expense

When will result announced

Deffered Tax is a fairly complex topic. Basically its a difference in carrying value of an item between accounting standards and tax legislation at the rate of tax e.g 34% and Deffered Tax is presented as "Liability" rather than part of Owners Equity.