Accountancy and Auditing Quiz No:3

Actual overhead costs appear:

Identify the correct answer with regards to depreciation expense:

The predetermined overhead is:

If net sales Rs. 100,000 cost of goods sold Rs. 55,000, administrative expenses Rs. 5300, selling expenses Rs. 4375, Interest expense Rs. 500, the operating profit is:

Which of the following would be least likely to be considered an objective of a system of internal control:

The basic concept which recognizes that the cost of internal control should not exceed the benefits expected to be derived is known as:

In projecting the future profitability of a trading company, investors will be least concerned with changes in:

Audit programme is prepared by:

A and B are partners in the ratio of 2:1. They admit C for ¼ shares who contribute Rs. 3000 for his share of goodwill. Total value of the goodwill of the firm is:

Both the accounts for depreciation expense and accumulated depreciation:

Unqualified report is favorable for:

Which of the following amounts appears in both the income statement and balance sheet?

Statutory meeting is necessary in case of:

Which of the following is not an acceptable inventory method?

Expenses can be called as:

Identify which of the normal balances (in parentheses) assigned to the following accounts is incorrect:

Which one of the following statements is incorrect with respect to external auditors:

Which of the following would be least likely to be considered a control objective?

A balance sheet is prepared to find out financial position of a firm

Which of the following is capital asset under the Income Tax Ordinance, 2001?

Normally test checking is adopted in case of

Which of the following rental income is exempted from tax under the head Income from Property?

If cost of goods sold Rs.450,000, Opening stock Rs.125,000 and Closing stock Rs.175,000 then inventory turnover ratio is:

Which one of the following is not considered a legal document of Joint Stock Company:

For each transaction, double-entry accounting requires which of the following:

In partnership minimum number of members is:

Conversion Cost consists of Director Material

Bond holders would be most interested in which of the following?

Markets are necessary because:

The book value of the depreciable asset is best defined as:

Audit Engagement letter is always obtained after the end of the audit.

In Public Ltd. Company, minimum number of members is:

Every limited company is legally required to get their account audited by a practicing Chartered Accountant

Which one of the following is to be repaid in the last in case of liquidation of company:

The most important reason for having an annual audit is to:

Which of the following is not an intangible asset?

Which of the following is principle purpose of evaluation on internal control?

Which of the following is ascertained by drawing up an income and expenditure account?

The Addition of Material and Labour is called:

Discovery of business opportunities and arrangement of property, funds, and management ability to set up a business is called:

On April 1, Hassan & Company received and paid a Rs.700 bill for the advertising done in March. In addition to this bill the company paid Rs. 6,100 during April for expenses incurred in that month. Hassan & Company paid Rs.3,600 as salary to employees for work done in April. Based on these facts, total expenses for the mont h of April were:

Second hand machinery worth Rs. 10, 000 was purchased, repairing of the machinery cost Rs. 1,000. The machinery was installed by own workers. Wage for this being Rs. 200, the machinery account should be debited for:

A transaction caused Rs. 20,000 decrease in both total assets and total liabilities. This transaction could have been:

Cost Accounting and Financial Accounting can be never be reconciled.

A cooperative society is registered under cooperative society act of:

Which of the following expenditures is admissible under the head income from Business?

Which of the following categories of accounts are closed at the end of an accounting period?

Retiring auditor can be appointed at:

The formula (Cost less salvage value/Total capacity in units x units extracted) refers to which depreciation method:

Current Companies Ordinance is that of:

EOQ is adopted to have efficient:

Which of the following eliminates details from the working trial balance by classifying and summarizing similar or related items?

Verification is carried out for:

A company has current ratio of 2 to 1 at the end of year 1. Which one of the following transactions will increase this ratio?

What percentage of profit a bank has to transfer to statutory reserve until it inflates to paid-up capital of the bank:

Which of the following statements is false?

Cost of Goods sold Rs.14,000. Purchases Rs.14,000 Carriage Inward Rs.1,000, carriage outward Rs.1,500 and closing inventory Rs.13,000. What is the opening inventory?

A retail store had current assets of Rs.72,000 and a current ratio of 2 to 1. The amount of working capital must have been:

The status of Chamber of Commerce and Industry in Pakistanis:

Average, minimum and maximum daily usage is 400, 180 and 520 units Respectively. Lead time 10 to 15 days and reorder quantity 8000 units. What is reorder level:

Revenue is most commonly recognized at the time when:

The preparation of work sheet:

When costs are rising, which method reports higher net income:

Standard Costing Procedures are not relevant in job costing

Short term finance can be arranged through:

Which of the following is a benefit of a just-in-time (JIT)inventory system?

Second Schedule is annexed to the Income Tax ordinance, 2001 and deals with exemptions from income tax

Which of the following list of accounts is used to compute the cost of goods sold?

The amount of overtime premium contained in direct wages would normally be classified as:

A job-order costing system is most appropriate for which of the following types of manufacturing?

Income and expenditure account in a non trading institution records transaction of:

Which of the following combination of business makes different types of goods and have in common either raw material or final product?

Assets would be overstated if necessary adjusting entry was omitted for:

If sales increase by 10% from year 1 to 2 and cost of goods sold increases only 6%, the gross profit on sales will increase by:

Of the following statements, which one is untrue for the corporate form of organization:

Comparison of a company’s financial condition and performance across time is a:

The face values and market value of shares remain the same in case of:

Rebate on bill discounted (unearned discount) is:

Which of the following is a clearing account?

Tax deducted at source will be treated as:

Income Tax is livable on every person with an annual income of Rs. 80,000

Which of the following is an agricultural income?

If annual requirement is 50,000 units, cost per unit Rs.15, ordering cost Rs.20 per order and holding cost 10% of the purchase price then what is economic order quantity?

Benchmark rate of interest for the tax year 2006 was:

Identify the item that is likely to serve as source document:

One of the basic purposes of business combination is:

Identify which items are subtracted from the list amount and not recorded when computing purchase price:

At the time of admission of a new partner, goodwill raised should be written off in:

The first auditor of a Public Limited Company is appointed by the directors with in:

Average relief is allowed on the following expenditures except:

Audit working papers are the property of:

If rent received is Rs.1000 per month, token money forfeited Rs.500, insurance premium paid Rs.100, water charges Rs.100, the net property income will be:

A loan taken from a bank for a period longer than two years is known as short-term loan

If cost of good sold Rs.600,000, Operating expenses 40,000, sales Rs.820,000, Sale return Rs.20,000 then operating ratio is:

When a partnership is liquidated:

Which of the following assets is not eligible for initial depreciation allowance?

Bonus payable only on the maturity of the policy is termed as:

While passing adjusting entries for what type of transactions expenses are debited and assets are credited:

Which of the following best describes the nature of an asset?

Which of the ratio best reflects a company’s ability to meet immediate interest payment?