CSS Past Papers of
Accounting & Auditing 2000 to 20015
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2000
Accounting & Auditing Paper -I
(1) Double entry book-keeping was fathered by:
(a) F.W.Taylor
(b) Henry Fayol
(c) Lucas Pacioli.
(2) Funds Flow Statement and sources and application statement
are:’
(a) Synonymous
(b) Antagonistic
(c) None of these.
(3) Depreciation in spirit is similar to:
(a) Depletion
(b) Amortization
(c) Depression.
4) Balance Sheet is always prepared:
(a) for the year ended.
(b) As on a specified date.
(c) None of these.
(5) In Insurance, the following Profit and
Loss Accounts are prepared: (a) Separate for Fire, Marine, and Accidents etc.
(b) Consolidated for Fire, Marine, and Accidents etc.
(c) None of
these.
(6) Partners in Pakistan can today be fixed at the following
numbers:
(a) 20
(b) 50
(c) 75.
(7) Flexible budget is a budget with the following features:
(a) Changes with volume of production.
(b) Changes with variable expenses
(c) Changes in Direct material.
(8) Break Even can be calculated as under:
(a) ______VC_______ FC- TR TC
(b) FC I- VC TR
(c) None of these.
(9) Quick Ratio can be computed as under:
(a) Quick . Assets/Quick Liabilities
(b) Quick . Liabilities Current Assets
(c) Current Assets/ Current Liabilities
(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) Rupee zero
(c) (c) None of these.
(11) Sales budget must be prepared:
(a) Independently
(b) Depending on production capacity
(c) Based on Sales forecasts of market.
(12) Consolidation of subsidiary accounts in the balance sheet of
a unlisted Holding company is at present in Pakistan:
(a) Compulsory (b)
Voluntary
(c) Required.
(13) Retained earning is synonymous to:
(a) Accumulated profit and loss account
(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.
(c) Under (a) and (b) above.
(15) Deferred Taxation is:
(a) Fixed asset
(b) Fixed liabilities
(c) Part of Owners Equity.
(16) Investment Corporation of Pakistan follows:
(a) Open-end mutual funds
(b) Closed-end mutual funds
(c) None of these.
(17) Directors Report is ---- in respect of financial report
constituent.
(a) Mandatory for a limited Company
(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) Chairman’s Review
(c) None of these.
(19) Cash budget excludes the following:
(a) Non-Cash items
(b) Cash items
(c) Purchase on Credit items.
(20) NGOs are legally required to:
(a) Prepare accounts in a prescribed manner under the law.
(b) Prepare accounts as desired by donors.
(c) None of these.
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2000
Accounting & Auditing Paper -II
1. Fixed Cost:
a. Changes with production
b. Never changes even if production capacity is doubled
c. None of the above
2. Conversion cost is:
a. Material Cost + Overhead Cost
b. Direct Labour + Material Cost
c. Labour Cost + Overhead Cost
3. Process Costing is relevant to:
a. Cement industry
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
c. Profit after deducting normal operating expenses including
depreciation
5. A good Cost Accounting System is:
a. If it computes estimated cost only
b. If it cannot be reconciled with financial accounts
c. If it enables management to increase productivity and rationalize
cost structure
6. Verification includes:
a. Checking Vouchers
b. Examining audit report
c. None of the above
7. Stratified audit sample means:
a. Randomly selected items for audit
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
c. None of above
9. Audit of a bank is generally conducted through:
a. Routine checking
b. Couching
c. Balance sheet audit
10. An auditor is liable for his annual audit of accounts o:
a. Creditors
b. Bankers
c. Owners
11. Income Tax is levied on:
a. Agricultural Income
b. Presumptive Income
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.
c. Pay income tax as required under the law.
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).
c. None of above
14. Income Tax rates are the same for:
a. Limited Companies
b. Banking Companies
c. None of above
15. Super Tax on companies is:
a. In vogue in Pakistan
b. Not in vogue in Pakistan
c. None of above
16. Current Ratio is calculated as:
a.
Fixed
Assets/Current Liabilities
b.
Current
Liabilities/Current Assets
c. Current Assets/Current Liabilities
17. Short-term loan can be described as:
a. If the period is three years
b. If the period is less than one year
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. 20
c. 100
19. Combination can be best described as:
a.
Restructuring of
Capital of a Company
b.
Reduction of
Capital of a Company
c. Amalgamation of two different types of businesses
20. Sources of funds can be increased by:
a.
Describing
selling prices
b.
Increasing
expenditure
c. None of above
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2001
Accounting & Auditing Paper -I
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
(c) Journal
(d)
None of these
(2) For preparing balance sheets prepaid expenses are shown as
part of:
(a)
Liability
(b)
Equities
(c) Assets
(d)
None of these
(3) Unpaid and unrecorded expenses are called:
(a) Prepaid expenses (b) Accrued expenses
(c) Additional expenses
(d)
None of these
(4) Amount, cash, or other assets removed from business by owner
is:
(a)
Capital
(b)
Drawings
(c) Assets
(d)
None of these
(5) Under the diminishing balance method, depreciation amount is:
(a)
Payment
(b)
Receipt
(c) Expenditure
(d)
None of these
(6) Users of accounting information include:
(a)
The tax
authorities
(b)
Investors (c)
Creditors
(d) All of these
(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
(d)
Partnership and
proprietorship
(e)
None of these
(8) The investment of personal assets by the owner:
(a)
Increases total
assets and increases owner’s equity
(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
(c) Retailer
(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
(d)
Assets
(e)
None of these
(11) An owner investment of land into the business would:
(a)
Decrease
withdrawals
(b)
Increase
liabilities
(c) Increase owner’s equity
(d)
Decrease assets
(e)
None of these
(12) A cash purchase of supplies would:
(a)
Decrease owner’s
equity
(b)
Increase
liabilities
(c) Have no effect on total assets
(d)
None of these
(13) An owner investment of each into the business would:
(a)
Increase assets
(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:
(a)
Decrease total
assets
(b)
Increase
liabilities
(c) Increase owner’s equity
(d)
None of these
(15) Real accounts are related to:
(a)
Assets
(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?
(a)
Cash
(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
(d)
Only (a) and (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
(d)
Gross profit
(e)
None of these
(19) The maximum number of partners in
Pakistan can be fixed at the following:
(a) 20
(b)
50
(c) 75
(d)
None of these
(20) Balance sheet is always prepared:
(a)
For the year
ended
(b)
As on a specific
date
(c) None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2001
Accounting & Auditing Paper -II
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:
(a)
An opportunity
cost
(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
(c) Budget
(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
(d)
Any location or
department which incurs cost
(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)
Rs. 0.50
(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)
Depreciation
(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)
Will not change
in total because it is not related to changes in production
(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:
(a)
DR finished goods
…….. CR WIP
(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
(d)
Selling plus
administrative expenses
(e)
None of these
(9) Expenses such as rent and depreciation of
a building are shared by several departments these are: (a) Indirect expenses
(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:
(a)
DR Cost of goods
sold …….. CR FOH control
(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:
(a)
4500 units
(b)
3900 unit
(c) 1200 units
(d)
400 units
(e)
None of these
(12) The time lag between indenting and receiving material is
called:
(a)
Lead time
(b)
Idle time
(c) Stock out time
(d)
None of these
(13) A credit balance remaining in FOH Control account is called:
(a)
Over-applied
overhead
(b)
Under-applied
overhead
(c) Actual overhead
(d)
None of these
(14) Direct material cost plus direct labour cost is called:
(a)
Prime cost
(b)
Conversion cost
(c) Product cost
(d)
All of these
(e)
None of these
(15) Productivity means:
(a)
The ability to
produce
(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:
(a)
Profit Center
(b)
Cost Center
(c) Cost driver
(d)
All of these
(e)
None of these
(17) Verification includes: (a) Checking
vouchers
(b)
Examining audit
report
(c) None of these
(18) Audit of a bank is generally conducted through:
(a)
Routine checking
(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)
Owner’s equity
(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)
If the period is
less than one year
(c) If the period is over one year
(d)
None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2002
Accounting & Auditing Paper -I
(1) Maximum number of partners in a partnership firm set up in
Pakistan under Partnership Act, 1932 is:
(a)
5
(b)
25
(c) 20
(d)
None of these
(2) Preparation of final financial reports is governed in Pakistan
under:
(a)
No law
(b)
Companies
Ordinance 1984
(c) None of these
(3) Depreciation is based on:
(a)
Economic life of
asset
(b)
Declared life of
asset by supplier
(c) Normal life of asset
(d)
None of these
(4) Inventory turnover is calculated as under:
(a)
Cost of Goods
sold/Closing Inventory
(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:
(a)
Liability
(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
(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
(9) Return of Equity will be calculated as under:
(a)
Operating Profit
x 100/Equity
(b)
Net profit x
100/Paid up Capital only
(c) None of these
(10) Current maturity of long term loan is:
(a)
Current Liability
(b)
Long Term
Liability
(c) None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2002
Accounting & Auditing Paper -II
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
(c) Direct labour + Direct Material
(d)
None of these
(2) Process Cost is very much applicable in:
(a)
Construction
Industry
(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)
Selection through
scientific sampling approach
(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:
(a)
Inflows
(b)
Outflows
(c) None of these
(7) M & A stands for:
(a)
Mergers &
Analysis
(b)
Mergers &
Acquisitions
(c) Mergers & Allocation
(d)
None of these
(8) An endowment insurance policy can be taken in respect of:
(a)
Fire insurance
(b)
Accident
insurance
(c) Life insurance
(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:
(a)
Quick test
(b)
Liquid test
(c) None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2003
Accounting & Auditing Paper -I
(1) Acid Test Ratio is calculated as under:
(a) Current Assets/Current Liabilities
(b)
Fixed
Assets/Current Liabilities
(c) Liquid Assets/Current Liabilities
(d)
None of these
(2) Deferred cost is a:
(a) Liability
(b)Asset
(c) None of these
(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
(4) Banks, for the preparation of financial statements, are
governed under:
(a)
Banking Companies
Ordinance, 1962
(b)
State Bank of
Pakistan Act
(c) None of these
(5) Return on investment is computed:
(a)
Investment/Profit
x 100
(b)
Profit x
100/Investment
(c) None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2003
Accounting & Auditing Paper -II
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:
(a) True
(b) False
(2) Sugar used in a sugarcane company is:
(a)
Variable cost
(b)
Fixed cost
(c) None of these
(3) An auditor is liable under the following
circumstances: (a) Third Party Liabilities
(b)
Fraud perpetrated
in highly sophisticated circumstances
(c) None of these
(4) Agricultural income is taxable under the
Income Tax Laws of Pakistan: (a) True
(b) False
(5) Principal and markup payment within one year constitutes long
term liability for disclosure in the balance sheet of a company.
(a)
True
(b)
False
(6) Ordinarily one can have the following partners in a
partnership in Pakistan under the Partnership Act 1932.
(a) 10 (b) 20
(c) 30
(d)
None of these
(7) Working Capital finance can be termed as “Running Finance” in
a limited company.
(a)
True
(b)
False
(8) Income from Capital gains arising out of trading on a stock
strange in Pakistan is taxable these days:
(a)
True
(b)
False
(9) Conversion Cost is calculated as under:
(a)
Labour Plus
Materials
(b)
Labour plus
overheads
(c) None of these
(10) Current Ratio can be calculated as under:
(a)
Current
Liabilities/Current Assets
(b)
Current
Assets/Current Liabilities
(c) None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2004
Accounting & Auditing Paper
(1) The need for keeping a record of income and expenditure is a
clear and systematic manner has given rise to the subject of:
(a)
Book
keeping
(b)
Accounting cycle
(c) Manufacturing
(d)
None of these
(2) If proper books of accounts are not kept in a business the
amount of profit:
(a)
Can be
ascertained
(b)
Cannot
be ascertained
(c) Easily ascertained
(d)
None of these
(3) The stage under which transactions are recorded
chronologically in the books of accounts is called: (a) Summarizing
(b)
Classifying
(c) Recording
(d)
None of these
(4) Book-keeping is mainly concerned with:
(a) Recording of a
financial data relating to business transactions
(b) Designing the systems in recording, classifying, summarizing the
recorded data (c) Interpreting the data for internal and external users
(d) None of these
(5) The term expenses and expenditure are:
(a)
Same
in nature
(b)
Different in
nature
(c) Opposite in nature
(d)
None of these
(6) When goods are given away as charity or free samples, the
purchases account should be: (a) Debited
(b)
Credited
(c) Recorded in balance sheet
(d)
None of these
(7) The sale of a business asset on credit is recorded in:
(a)
Sales journal
(b)
General
journal
(c) Cash receipt journal
(d)
None of these
(8) The discount account is a:
(a)
Personal account
(b)
Real account
(c) Nominal account
(d)
Asset account
(e)
None of these
(9) The payment side of the cash book is under cost by Rs. 200
when overdraft as per bank statement is the starting point:
(a)
Rs 200 will be
deducted
(b)
Rs
200 will be added
(c) Rs 400 will be added
(d)
Rs 400 will be
deducted
(10) All the direct expenses are charged to:
(a)
Balance sheet
(b)
Profit and Loss
account
(c) Trading account
(d)
None of these
(11) Those liabilities which arise only on the happening of some
event, are called:
(a)
Current
liabilities
(b)
Contingent
liabilities
(c) Outstanding liabilities
(d)
Fixed liabilities
(12) Marshalling of balance sheet means:
(a)
The
ordering of its assets and liabilities
(b)
The totaling of
its assets and liabilities
(c) Excess of assets over liabilities
(d)
None of these
(13) Commission received in advance is to be considered as:
(a)
Outstanding
expense
(b)
Accrued income
(c) Prepaid expense
(d)
Unearned
income
(14) The provision for discount on creditors
is often not provided in keeping with the principle of: (a) Materiality
(b)
Consistency
(c) Conservatism
(d)
Realization
(15) Which one of the following is not
considered the permanent part of the accounting record: (a) Journal
(b)
Trial
Balance
(c) Balance sheet
(d)
Final accounts
(16) A working paper which is prepared by the accountant for his
own convenience is called:
(a)
Work
sheet
(b)
Cash flows
statement
(c) Balance sheet
(d)
Final accounts
(17) Any expenditure incurred to increase the profit earning
capacity of the concern is a:
(a)
Revenue
expenditure
(b)
Capital
expenditure
(c) Deferred revenue expenditure
(d)
Capital
expenditure
(18) Depreciation on fixed assets is an example of:
(a)
Revenue
expenditure
(b)
Capital
expenditure
(c) Deferred revenue expenditure
(d)
None of these
(19) The capital receipts are shown in the balance sheet on the:
(a)
Liability
(b)
Asset side
(c) Debit side
(d)
None of these
(20) Error due to wrong allocation as expenditure between capital
and revenue is regarded as:
(a) Error of omission
(b)
Error
of principle
(c) Compensation errors
(d)
Error of
commission
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2005
Accounting & Auditing Paper
(1) The purchase of machinery on account would
(a)
Increase an asset
and decrease another asset
(b)
Increase an asset
and decrease liability
(c) Increase an asset
and increase liability
(d)
Decrease an asset
and increase liability
(2) In general, the accounts in the income statement are known as:
(a)
Real account
(b)
Contra asset
(c) Nominal account
(d)
Unrecorded revenue
account
(3) In general terms, financial assets appear in the balance sheet
at:
(a)
Face
value
(b)
Current cash
value
(c) Cash
(d)
Estimated future
sales value
(4) A limited Co. sold marketable securities cost Rs. 80,000 for
Rs. 92,000 cash. In
Co.’s income statement and statement of cash flows respectively,
this will appear as:
(a)
A
Rs. 12,000 gain and Rs. 92,000 cash receive
(b)
A Rs. 92,000 gain
and Rs. 8,000 cash receive
(c) A Rs. 12,000 gain and Rs. 80,000 cash receive
(d)
A Rs. 92,000
sales and Rs. 92,000 cash receive
(5) Which of the following is least important as a measure of
short term liquidity?
(a)
Debtor ratio
(b)
Current ratio
(c) Cash flow from
operating activities
(d)
Quick ratio
(6) Uzma Ltd. Net income was Rs. 4,00,000 in 2003 and Rs.
1,60,000,in 2004. What percentage increase in net income must achieve in 2005
to off set the decline in profits in 2004?
(a)
60%
(b)
150%
(c) 200%
(d)
70%
(7) Which of the following does not describe accounting?
(a)
Language of
Business
(b)
Is
an end rather than a mean to an end
(c) Useful for decision making
(d)
Used by business
government, nonprofit organizations and individuals.
(8) External uses of financial accounting information include all
of the following except:
(a)
Investors
(b)
Labour unions
(c) Line manager
(d)
General public
(9) A fixed budget is:
(a)
A
budget for single level of activity
(b)
A budget which
ignored inflation
(c) Used only for fixed cost
(d)
An overhead cost
budget
(10) Heavy expenditure on advertisement of a new product is a:
(a)
Capital
expenditure
(b)
Revenue
expenditure
(c) Deferred revenue
expenditure
(d)
None of these
(11) Subscriptions received in advance is:
(a)
An income
(b)
An asset
(c) A liability
(d)
A loss
(12) At the time of admission of a new partner, goodwill raised
should be written off in:
(a)
New profit
sharing ratio
(b)
Old
profit sharing ratio
(c) Sacrificing ratio
(d)
Gaining ratio
(13) A and B are partners in the ratio of 2:1.
They admit C for ¼ shares who contributes Rs. 3000 for his share of goodwill.
The total value of the goodwill of the firm is: (a) Rs. 3,000 (b) Rs. 9,000
(c) Rs. 12,000
(d) Rs. 15,000
(14) Sales to Mustafa of Rs. 10,000 not recorded in the books
would affect:
(a)
Sales account
(b)
Mustafa
account
(c) Sales account and
Mustafa Account
(d)
None of these
(15) Depreciation is a process of:
(a)
Valuation
(b)
Allocation
(c) Both a & b
(d)
None of these
(16) Loss on sale of an asset should be written off against:
(a)
Share premium
account
(b)
Sales account
(c) Depreciation fund account
(d)
None
of these ( P & L A/C Dr and Fixed Asset Cr )
(17) Income and expenditure account reveals
(a)
Cash in hand
(b)
Surplus
or deficiency
(c) Capital account
(d)
None of these
(18) Which of the following is true regarding the work sheet.
(a) It is the form, which an accountant uses for his own aid and
convenience. (b) It assists in the
orderly preparation of the adjustments and financial statements at the end of
the account period.
(c) It can substitute for Journal and ledger
(d) Only a & b
are true
(19) The post closing trial balance will:
(a)
Contain only
income statement accounts
(b)
Contain
only balance sheet accounts
(c) Contain both income statement and balance sheet accounts
(d)
Be prepared
before closing entries are posted to the ledger
(20) The cost of goods and services used up in the process of
obtaining revenue are called:
(a) Net income
(b)
Revenue
(c) Expenses
(d)
Liabilities
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2006
Accounting & Auditing Paper
(1)
There is no
difference between Financial Report and Financial statement. (True/False)
(2)
Calculating
number of days uncollected of sales is known as Collection Index. (True/False)
(No such a word exist in accounting lexicon)
(3)
Wages paid for
construction of a plant is revenue expenditure. (True/False)
(4)
Times interest
earned is a great interest for a banker. (True/False)
(5)
Budgeted Profits
are always high when pessimistic approach for preparing budget is followed.
(True/False)
(6)
Work Sheet only
presents Balance Sheet figures. (True/False)
(7)
Trial Balance is
prepared from ledger. (True/False)
(8)
Banks are
governed under the Companies Ordinance, 1984 only for preparation of their
financial statements. (True/False)
(9)
Suspense Account
is a clear account with no question to be asked. (True/False)
(10) Ledgers are prepared from vouches much before transactions are
recorded in the Journal. (True/False)
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2007
Accounting & Auditing Paper
(1)Which of the following best describes the nature of an asset?
(a)
Something with a
ready market value
(b)
An
economic resource, which will provide some future benefits, owned by a business.
(c) The amount of the owner’s investment in a business
(d)
None of these
(2) A balance sheet is prepared to find out financial position of
a firm:
(a)
For a specified
period
(b)
On
a particular date
(c) At the time of sale of business
(d)
None of these
(3) The preparation of work sheet:
(a)
Constitutes
creation of a formal financial statement
(b)
Eliminates the
need for entering adjusting entries in the journal
(c) Provides the information needed for journalizing adjusting and
closing entries (d) None of these
(4) Assets would be overstated if necessary adjusting entry was
omitted for:
(a)
Expired
Insurance
(b)
Accrued
Salaries
(c) Accrued Interest Earned
(d)
None of these
(5) The book value of the depreciable asset is
best defined as: (a) The un-depreciated cost of
the asset
(b)
The price that
the asset would fetch if offered for sale
(c) Accumulated depreciation of the asset since acquisition
(d)
None of these
(6) Which of the following is not an intangible asset?
(a)
A patent
(b)
A trademark
(c) An investment in
marketable securities
(d)
None of these
(7) 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?
(a)
Sales
of bonds payable at a discount
(b)
Declaration of a
20% cash dividend
(c) Collection of a large account receivable
(d)
None of these
(8) 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:
(a)
4%
(b)
10%
(c) 6%
(d)
None of these
(9) Which of the following is not an acceptable inventory method?
(a)
Lower of cost or
market
(b)
Sales
value
(c) Specific identification
(d)
None of
these
(10) which of the following amounts appears in both the income
statement and balance sheet?
(a)
Net
Income
(b)
Accumulated
depreciation
(c) Dividends
(d)
None of these
(11) Both the accounts for depreciation expense and accumulated
depreciation:
(a)
Are closed at the
end of the period
(b)
Appear in the
Adjusted Trial Balance Columns of the worksheet
(c) Appear in the
Trial Balance Columns of the worksheet
(d)
None of these
(12) When a partnership is liquidated:
(a)
Any cash
distribution to partners is allocated according to the profit and loss sharing
ratio.
(b)
Cash is
distributed to each partner according to his or her capital account balance
before the sale of partnership assets.
(c) Any gain or loss
on disposal of partnership assets is divided among the partners according to their relative account balances.
(d)
None of these
(13) In projecting the future profitability of a trading company,
investors will be least concerned with changes in:
(a)
The gross profit
rate
(b)
The
quick ratio
(c) Sales volume
(d)
None of these
(14) Revenue is most commonly recognized at the time when:
(a)
Cash is
collected
(b)
The order is
received from customers
(c) The sale is made
(d)
None of these
(15) Which of the following list of accounts is used to compute
the cost of goods sold?
(a)
Purchases,
inventory, and sales returns.
(b)
Gross profit,
purchase returns and carriage inward.
(c) Inventory, net
sales and purchases
(d)
none of
these
(16) Which of the following is ascertained by drawing up an income
and expenditure account?
(a) Cash in hand
(b) Surplus or
Deficiency
(b) Capital Fund
(d) none of these
(17) 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 month of April were:
(a) Rs.6,100 (b) Rs.6,800
(c) Rs.10,700
(d) None of these
(Bill of march Rs 6100 + Salary exp Rs 3600= Rs 9700 )
(18) Which of the following categories of accounts are closed at
the end of an accounting period? (a) Temporary
accounts
(b)
Permanent
accounts
(c) Personal accounts
(d)
None of
these
(19) 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:
(a)
Rs.144,000
(b)
Rs.108,000
(c) Rs.72,000
(d)
None of these
(20) Bond holders would be most interested in which of the
following?
(a)
Quick ratio
(b)
Inventory
turnover
(c) Times interest
earned
(d)
None of these
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2008
Accounting & Auditing Paper
1. Identify the item that is likely to serve as source document:
a.
Trial balance
b.
Income statement
c. Balance sheet
d.
Invoice
from supplier
2. Identify which of the normal balances (in parentheses) assigned
to the following accounts is incorrect:
a.
Office supplies
(Debit)
b.
Cash (Debit)
c. Wages payable (Credit)
d.
Fee
earned (Debit)
3. The formula (Cost less salvage value/Total
capacity in units x units extracted) refers to which depreciation method: a.
Straight line
b.
Units
of production
c. Declining balance
d.
Depletion
4. While passing adjusting entries for what type of transactions
expenses are debited and assets are credited:
a. Accrued revenue
b.
Accrued expenses
c. Unearned Revenue
d.
Prepaid
Revenue
5. Of the following statements, which one is untrue for the
corporate form of organization:
a.
It is a separate
legal entity
b.
It
has a limited life
c. Income that is distributed to owners is usually taxed twice
d.
Ownership rights
can be easily transferred
6. For each transaction, double-entry accounting requires which of
the following:
a.
Debits
to asset accounts must create credits to liability or equity accounts
b.
A debit to a
liability account must create a credit to an asset accounts
c. Total debits must equal total credits
d.
None of these
7. When costs are rising, which method reports
higher net income: a. LIFO
b.
FIFO
c. Average
d.
The most recent
purchase price
8. A transaction caused Rs. 20,000 decrease in both total assets
and total liabilities.
This transaction could have been:
a.
Purchase of an
asset for Rs. 20.000 cash
b.
Asset costing Rs.
20,000 destroyed by fire
c. Repayment of Rs.
20,000 bank loan
d.
Collection of Rs.
20,000account receivable
9. What percentage of profit a bank has to transfer to statutory
reserve until it inflates to paid-up capital of the bank: a. 5%
b.
10%
c. 20%
d.
25%
10. Identify the correct answer with regards to depreciation
expense:
a.
Is
an application of the matching principle?
b.
Is a closing
entry?
c. Usually includes an offsetting credit either to cash or accounts
payable.
d.
Is not an
adjusting entry?
11. Comparison of a company’s financial condition and performance
across time is a:
a.
Ratio analysis
b.
Horizontal analysis
c. Vertical analysis
d.
None of these
12. Income and expenditure account in a non trading institution
records transaction of:
a.
Revenue
nature only
b.
Capital nature
only
c. Both (a) & (b)
d.
Income of revenue
nature and expenditure of revenue and capital nature
13. At the time of admission of a new partner, goodwill raised
should be written off in:
a.
New profit
sharing ratio
b.
Old
profit sharing ratio
c. Sacrificing ratio
d.
Gaining ratio
14. 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: a. Rs. 3000
b.
Rs. 9000
c. Rs. 12000
d.
15000
15. 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. Rs. 10,000
b.
Rs. 11,000
c. Rs. 11,200
d.
None of these
16. 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:
a. Rs.35325 (operating profit does not inclue
interest income/expense and Taxes)) b. Rs.45000
c. Rs.39700
d.
Rs.34825
17. Which of the ratio best reflects a company’s ability to meet
immediate interest payment?
a.
Debit ratio
b.
Equity ratio
c. Times interest
earned
d.
None of these
18. Identify which items are subtracted from
the list amount and not recorded when computing purchase price: a. Freight in
b.
Trade
discount
c. Purchase discount
d.
Purchase return
19. Bonus payable only on the maturity of the policy is termed as:
a.
Cash bonus
b.
Reversionary
bonus
c. Interim bonus
d.
Bonus
is reduction of premium
20. Rebate on bill discounted (unearned discount) is:
a.
An expense
b.
An income
c. A liability
d.
An asset
FEDERAL PUBLIC SERVICE COMMISSION
COMPETITIVE EXAMINATION FOR
RECRUITMENT TO POSTS IN BPS-17
UNDER THE FEDERAL GOVERNMENT 2009
Accounting & Auditing Paper
(i) Which of the following transactions
represent an expense?
(a)
The owner
withdrew Rs. 1,600 from the business for personal use
(b)
Purchased a
photocopying machine for Rs. 2,750 cash
(c) Purchased medical supplies for cash from Healthcare Labs. Rs.
1,630
(d)
Received a
telephone bill amounting to Rs. 550 to be paid within ten days.
(ii) Which of the
following statements about accounting procedures is not correct?
(a) The journal shows in one place all the
information about specific transactions arranged in chronological order.
(b)
A ledger account
shows in one place all the information about changes in a specific asset or
liability or owner’s equity.
(c)
Posting is the
process of transferring information from ledger accounts to the journal.
(d)
The product of
the accounting cycle is the formal financial statements such as balance sheet
and income statement.
(iii) Which of
the following financial statements reflects the overall financial position of the business?
(a) Statement of cash flows
(b) Income Statement
(c) Balance Sheet
(d) Statement of owner’s equity
(iv) Trial
Balance is prepared:
(a) To ensure arithmetical accuracy of accounting records.
(b) To establish complete accuracy of accounting records.
(c) To determine the amounts payable to suppliers for purchase of
goods on credit.
(d) To ensure efficient use of resources of the business.
(v) The net sales
of Fresh Foods were Rs. 200,000 for the current month. If the cost of goods available for sale was Rs. 180,000 and the
gross profit rate was 35%, the ending inventory
must have been:
(a) Rs. 70,000
(b) Rs. 1,30,000
(c) Rs. 50,000
(d) Rs. 63,000
(200,000 – 180, 000 – X = 70, 000( 0.35* 200,000 = 70,000 )) = X=
50, 000
(vi) In the
accounting cycle:
(a)
Closing entries
are made before adjusting entries.
(b)
Closing entries
are made after the adjusting entries.
(c) Adjusting entries are made after financial statements are
prepared.
(d)
Financial
statements are prepared after closing trial balance.
(vii) Which of
the following is an intangible asset?
(a) An investment in marketable securities.
(b) Leasehold land.
(c) Loose tools.
(d) Copy rights.
(viii) Expense is
recorded in the accounting records when:
(a) Cash is paid
(b) The purchase order is placed with the supplier
(c) Purchases are
made
(d) None of
these
(ix) The cash
basis of accounting:
(a)
Is widely used by
manufacturing firms.
(b)
Is often used by
merchandising firms.
(c) Usually results in a larger amount of tax than under accrual basis
accounting.
(d)
Cannot be used in
filing income tax returns.
(x) The
straight-line method of depreciation:
(a)
Generally gives
best results because it is easy to apply
(b)
Should be use din
a period of inflation, because it accumulates the fund for the replacement of
asset at a uniform rate.
(c) Is the best method used for wasting assets.
(d)
Ignores
fluctuations in the rate of asset usage.
(xi) Which of the
following accounts are not closed at the end of an accounting period?
(a) Revenue accounts
(b) Expense accounts
(c) Drawing accounts
(d) Asset accounts
(xii) Under
periodic inventory system cost of good sold is determined and recognized in the books of accounts:
(a) At the time of purchase of goods
(b) At the time of sale of goods
(c) At the end of the year
(d) None of these
(xiii) Which of
the following is not a use of working capital?
(a) Repayment of long term debt
(b) Cash dividend declared but not paid
(c) Payment of an account payable
(d) Acquisition of treasury stock.
(xiv) A
transaction caused a Rs. 10,000 decrease in both assets and total liabilities. This
transaction could have been:
(a)
Purchase of furniture
for Rs. 10,000
(b)
An asset costing
Rs.10,000 was destroyed by fire
(c) Repayment of bank loan Rs. 10,000
(d)
Collection of a
Rs.10,000 account receivable
(xv) Which ratio
indicates a firm’s ability to pay current liabilities in the shortest possible time?
(a) Current Ratio
(b) Equity Ratio
(c) Debt Ratio
(d) Quick Ratio
(xvi) If we add
the average number of days to turn the inventory over and the average age of receivables (in number of days), we arrive
at:
(a) The company’s fiscal period
(b) The sales volume of the business
(c) The company’s operating cycle
(d) Nothing meaningful
(xvii) Which of
the following is least important in determining the fair market value of a share?
(a) Earnings and dividends per share
(b) Book value per share
(c) The available supply of shares and the demand to purchase the
shares.
(d) The par value of share.
(xviii) Financial
statements prepared by a business firm are most likely to be:
(a) Fully reliable
(b) Tentative in nature
(c) Relevant for all types of decisions
(d) Always misleading
(xix) One of the
following is not an officer of a company:
(a) Share registrar
(b) Controller
(c) Secretary
(d) Treasurer
(xx) A deficit appears on the balance sheet:
(a) Among the
assets
(b) As a deduction from total paid-up capital
(c) Among the liabilities
(d) None of these
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