If incoming partner brings the goodwill in cash and it is paid by the incoming partner to the old partners privately in the ratio of their sacrifice. What accounting entry would be passed in the books of firm?

• A) No entry
• B) Goodwill a/c debit and cash a/c credit
• C) Bank a/c debit and Goodwill a/c credit
• D) Goodwill a/c debit and old partner’s capital a/c credit

Which of the following is an example of business formed under the Companies Ordinance 1984?

• A) An Easy paisa Shop
• B) Israr Chemicals limited
• C) H&H partnership concern
• D) All of the given options

Which of the following would be credited for increasing the provision for deferred tax?

• A) Deferred tax liabilities a/c
• B) Income tax expenses a/c
• C) Provision for income tax a/c
• D) Provision for liabilities a/c

Which of the following is the contra item for Purchases ?

• A) Sales return
• B) Creditors
• C) Purchases return
• D) Provision for doubtful debts

Which of the following appears in the credit side of Trial Balance of company account?

• A) None of the given options
• B) Liabilities
• C) Expenses
• D) Assets

Which of the following represents the excess of issued price over the nominal value of shares?

• A) Share Capital
• B) Discount on issue of share
• C) Profit of the company
• D) Premium on issue of share

Revaluation reserve and capital redemption reserve are example of_____________ and _______________ respectively reported in balance sheet:

• A) Revenue reserve, Revenue reserve
• B) Capital reserve, Revenue Reserve
• C) Revenue reserve, Capital reserve
• D) Capital reserve, Capital reserve

A free share of stock given to current/existing shareholders in a company is called;

• A) Rights issue
• B) Bonus Shares
• C) None of the given options
• D) Ordinary shares

Which of the following option is correct regarding the characteristic of the public limited company?

• A) Directors are the agents of the company
• B) Directors can be non-elective
• C) All of the given options
• D) Limited liability of the member

If a company runs into financial difficulties, it cannot be forced to make further contributions to the company, which one of the following salient features of the limited liability company describe it?

• A) Board of Directors
• B) Borrowing from lenders
• C) Limited liabilities
• D) Separate legal entity

Goodwill raised in partnership is distributed among the:

• A) New Partners
• B) New and old partners
• C) Old partners
• D) Senior Partners

Revaluation of assets is favourable when

• A) Assets are of fixed in nature
• B) Assets are appreciated
• C) All of the given options
• D) Owners are agree

A company has purchased a land at Rs. 10 million a year ago now its market value is Rs. 11 million. In this example the:

• A) Increase in value has increasing effect on profit
• B) Rs. 1 million can be distributed to shareholders
• C) Rs. 1 million can be transferred to general reserve
• D) Increase in value is known as unrealized profit

Organizational reputation is capitalized as:

• A) Competitive advantage
• B) Strength of the business
• C) Super profit
• D) Goodwill

Net worth of the business is an important to know because:

• A) It determines the profitability
• B) It helps to determine the Goodwill
• C) It increases the fixed assets
• D) It increases the profitability

A company has purchased machinery (fixed assets) at Rs. 10 million a year ago now it has sold at market value Rs. 11 million. Which of the following statement is NOT true?

• A) Rs. 1 million can be transferred to general reserve
• B) Rs. 1 million can be distributed to shareholders
• C) Increase in value is known as realized profit
• D) Increase in value has increasing effect on operating profit

Which of the following represents the objective of the financial statements?

• A) To provide the information about the business objectives
• B) To provide the information about the financial position, financial performance and changes in financial position
• C) To provide the information about the business assets
• D) To provide the information about the business liabilities

Which of the following is TRUE with respect to the loss on revaluation of assets and liabilities?

• A) Capital of old partners are credited
• B) New profit ratio is utilized for loss distribution
• C) Revaluation account is credited
• D) Revaluation account is debited

Profit from revaluation of land is an example of:

• A) Realized profit
• B) Gross profit
• C) Unrealized profit
• D) Expected profit

Which of the following represents that the shares are issued at a price above the face value?

• A) Share issued at nominal value
• B) Share issued at discount
• C) Share issued at par value
• D) Share issued at premium