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Accounting Mcqs

You have been proposed as auditor of a company. What is the first step that you should take?

  • (A)  Obtain the client’s permission to communicate with the existing auditor
  • (B)  Obtain the existing auditor’s working papers
  • (C)  Obtain a copy of the company’s most recent board minutes
  • (D)  Obtain a copy of the existing auditor’s letter of engagement
Submitted By :Ali Uppal


Which one of the following may auditors NOT perform for their client?

  • (A)  Taking management decisions
  • (B)  Preparation of accounting records
  • (C)  Preparing tax computations
  • (D)  Advising on weaknesses in the internal control systems
Submitted By :Ali Uppal


Submitted By :Ali Uppal


Submitted By :Ali Uppal


Which of the following statements is INCORRECT?

  • (A)  An auditor may serve on the board of directors of an audit client.
  • (B)  An auditor who is an immediate family member of the director of an audit client must not be assigned to the audit team.
  • (C)  Purchasing goods from an audit client on normal commercial terms does not create a threat to the auditor’s independence.
  • (D)  An auditor who was recently a director of an audit client must not be assigned to the audit team for that client.
Submitted By :Ali Uppal


The amount invested by the proprietor to start the business is called:

  • (A)  Capital
  • (B)  Business
  • (C)  Drawings
  • (D)  All of them
Submitted By :Ali Uppal


Obligation of the Business are known as___________?

  • (A)  Liabilities
  • (B)  Revenues
  • (C)  Expenses
  • (D)  Assets
Submitted By :Ali Uppal


Discount received is a/an:

  • (A)  Asset
  • (B)  Expense
  • (C)  Liability
  • (D)  Revenue
Submitted By :Ali Uppal


Double entry means______________?

  • (A)  Entry in two sets of books
  • (B)  Entry at two ends
  • (C)  Entry at two dates
  • (D)  Entry for two aspects of the transaction
Submitted By :Ali Uppal


The person to whom goods are sold on credit is called___________?

  • (A)  Buyer
  • (B)  Seller
  • (C)  Debtor
  • (D)  Creditor
Submitted By :Ali Uppal