Which one of the following inventory methods uses random withdrawal of inventory’ units?

• A) Average cost method
• B) First-in-First - out (FIFO)
• C) Last-in-First-Out (LIFO)
• D) All of the given options

Which of the following is NOT the characteristic of financial Statements?

• A) Information can be used for ratio analysis
• B) Always presented in the monetary terms
• C) Help in the assessment of projected incomes
• D) Provide the information about the Management and employees

Which one of the following inventory methods shows higher inventory valuation on balance sheet during inflation period?

• A) Average cost method
• B) Last-in-First-Out (LIFO)
• C) First-in-First - out (FIFO)
• D) All of the given options

Which of the following is the proper journal entry to record services rendered by ABC Company to a client for Rs. 500.

• A) Debit Cash 500; Credit Accounts Receivable 500
• B) Debit Accounts Receivable 500; Credit Capital Stock 500
• C) Debit Accounts Receivable 500; Service Revenue 500
• D) Cash 500; Credit Service Revenue 500

Nestle Pakistan Limited is an example of which of the following types of businesses?

• A) Service
• B) Manufacturing
• C) Merchandise
• D) Whole seller

Which of the following depreciation method does NOT provide a better tax shield?

• A) Accelerated depreciation
• B) Sum of the years digit
• C) Straight line
• D) Double declining balance

The sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale were:

• A) Greater than book value
• B) Less than book value
• C) Greater than cost
• D) Less than current market value

Stock holders’ equity of a corporation may NOT effect if:

• A) A company suffers losses in a year
• B) Issued bones shares
• C) Fluctuations are there in market value of shares
• D) Pay dividend to the shareholders

Which of the following is NOT a goal of analysis of financial statements?

• A) Assess the past performance
• B) Predict the future performance of the company
• C) Asses the working of management in the future
• D) Asses the current financial position

What is meant by the term “Quality of Financial Statements”?

• A) Financial Statement are prepared by the experts
• B) Financial Statement show the true picture of the business
• C) Financial Statements are audited by the Auditors
• D) Financial statements are reviewed by the CEO

Which statement is true about the shareholders?

• A) They have the right of drawings in the company
• B) They are the only stakeholders
• C) They usually have right to vote in annual general meeting
• D) They are entitle to receive annual return

Which of the following is NOT a part of the five-year summary of a company?

• A) Net income/Loss
• B) Discontinued operations
• C) Net sales
• D) Total assets

The error in the inventory evaluation during the current year will affect:

• A) Income of the year
• B) All of the given options
• C) Closing inventory
• D) Retained earning of the year

Audit opinions CANNOT be classified as which of the following?

• A) Disagreement of opinion
• B) Qualified opinion
• C) Unqualified opinion
• D) Adverse opinion

Which of the following account is debited when the shares are issued below the par value?

• A) Discount on issue of shares
• B) Premium on issue of shares account
• C) Share capital account
• D) Loss on issue of shares account

All of the following are true about the partnership business Except:

• A) Liability of partners is unlimited normally
• B) It must be formed for profit
• C) There can be maximum 10 partners
• D) It is registered under Partnership Act 1932

All of the following are based on Matching Principle under GAAP Except:

• A) Recording of Expenses
• B) Cash Flow Statement
• C) Measurement of Net income
• D) Depreciation charged during a period

Dividend must be approved by which of the following each time before they are paid to shareholders?

• A) Common Stockholders
• B) Management
• C) Preferred Stockholders
• D) Board of directors

Net income calculated under GAAP is based on:

• A) Matching principle
• B) Separate entity principle
• C) Realization principle
• D) Cost principle

Use the following information to compute gross margin. Sales price of merchandise sold to customers Rs. 10,000, beginning inventory Rs. 1,000, inventory purchases Rs. 4,000, and cost of inventory sold Rs. 3,000.

• A) Rs. 3000
• B) Rs. 5,000
• C) Rs. 2,000
• D) Rs. 7,000