Commerce MCQ for PPSC FPSC KKPSC BPSC SPSC Practice Test 3

1- 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

2- 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

3- Preparation of final financial reports is governed in Pakistan under:

A). No Law

B). Companies Ordinance✔️

C). None of these

4- Inventory turnover is calculated as under:

A). CGS/ closing Inventory✔️

B). Gross profit Closing Inventory

C). Opening Inventory

D). None of these

5- Preparation of annual report of a firm governed under:

A). Partnership Act 1932

B). Under partnership Deed

C). None of these✔️

6- Increase in income constitutes:

A). Inflows✔️

B). Outflows

C). None of these

7- Audit and special aduit are the same:

A). In Insurance company

B). In Banking company✔️

C). None of these

8- Rent of the premises constitutes variable expense for cost allocation.

A). True

B). False✔️

9- Principal and Markup payment within one year constitutes long term liability for disclosure in the balance sheet of a company.

A). True

B). False✔️

10- Working Capital finance can be termed as “Running Finance”  in a limited company.

A). True

B).  False✔️

11- Conversion cost is calculated as under:

A). Labour plus materials

B). Labour plus overheads cost✔️

C). None of these

D). All of these 

12- Current Ratio can be calculated as under:

A). Current Liabilities current Assets

B). Current Assets✔️

C). Current Liabilities

D). None of these

13-  The need for keeping a record of income and expenditures in a clear and systematic manner has given rise to the subject of:

A). Book keeping

B). Accounting Cycle✔️

C). Manufacturing

D). None of these

14-  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

15- The state under which transaction are recorded chronologically in the books of accounts is called:

A). Summarizing

B). Classifying

C). Recording

D). None of these✔️

16- The terms expense and expenditure are:

A). Same in Nature

B). Different in Nature✔️

C). Opposite in Nature

D). None of these

17- 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

18- 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

19- The discount account is a:

A). Personal Account

B). Nominal Account✔️

C). Real Account

D). Asset Account

20- The payments 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). None of these

21- All the direct expenses are charged to:

A). Balance sheet

B). Profit and Loss Account

C). Trading Account✔️

D). None of these

22- Those liabilities which arise only on the happening of some event, are called:

A). Current Liabilities

B). Contingent Liabilities✔️

C). Outstanding Liabilities

D). None of these

23- Commission received in advance is to be considered as:

A). Outstanding Expense

B). Accrued Income

C). Prepaid Expense

D). Unearned Income✔️

E). None of these

24- The provision for discount on creditors is often not provided in keeping with the principle of:

A). Materilality

B). Consistency

C). Conservatism✔️

D). Realization

25- Which one of the following in not considered the permanent part of the accounting record?

A). Journal

B). Trial Balance

C). Balance sheet

D). Final Accounts

E). None of these✔️

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