Practice Pakistan's most useful MCQs for competitive exams

What annuity is required over 12 years to equate with a future amount of P 20,000? Assume i= 6% annually ?

• (A)  P 1,290.34
• (B)  P 1,185.54
• (C)  P 1,107.34
• (D)  P 1,205.74

Answer

Submitted By :Ali Uppal

What is the present worth of a P500 annuity starting at the end of the third year and continuing to the end of the fourth year, if the annual interest rate is 10 % ?

• (A)  P 727.17
• (B)  P 717.17
• (C)  P 714.71
• (D)  P 731.17

Answer

Submitted By :Ali Uppal

In year zero, you invest P 10,000.00 in a 15% security for 5 years. During that time, the average annual inflation is 6%. How much in terms of year zero pesos will be in the account at maturity ?

• (A)  P 15,030.03
• (B)  P 20,113.57
• (C)  P 18,289.05
• (D)  P 16,892.34

Answer

Submitted By :Ali Uppal

A firm borrows P2,000 for 6 years at 8%. At the end of 6 years, it renews the loan for the amount due plus P2,000 more for 2 years at 8%. What is the lump sum due ?

• (A)  P 3,260.34
• (B)  P 3,280.34
• (C)  P 3,270.34
• (D)  P 3,250.34

Answer

Submitted By :Ali Uppal

What is the present worth of two P 100 payments at the end of the third year and fourth year? The annual interest rate is 8%?

• (A)  P 150.56
• (B)  P 152.88
• (C)  P 153.89
• (D)  P 151.09

Answer

Submitted By :Ali Uppal

The Saudi Arabian Oil Refinery developed an oil well which is estimated to contain 5,000,000 barrels of oil at an initial cost of $ 50,000,000. What is the depletion charge during the year where it produces half million barrels of oil? Use Unit or Factor method in computing depletion?

• (A)  $ 5,000,000.00
• (B)  $ 5,010,000.00
• (C)  $ 5,025,000.00
• (D)  $ 5,050,000.00

Answer

Submitted By :Ali Uppal

Shell Philippines, a multinational company, has a total gross income for a particular year of P 50,000,000. The taxable income after taking all deductions except for depletion is P 18,500,000. What is the allowable depletion allowance for that particular year? Take percentage of gross income for oil as 22%?

• (A)  P 9,358.41
• (B)  P 9,228.45
• (C)  P 9,250.00
• (D)  P 9,308.45

Answer

Submitted By :Ali Uppal

An asset is purchased for P 9,000.00. Its estimated economic life is 10 years after which it will be sold for P 1,000.00. Find the depreciation in the first three years using sum-of-years digit method____________________?

• (A)  P 3,279.27
• (B)  P 3,927.27
• (C)  P 3,729.27
• (D)  P 3,792.72

Answer

Submitted By :Ali Uppal

ABC Corporation makes it a policy that for any new equipment purchased, the annual depreciation cost should not exceed 20% of the first cost at any time with no salvage value. Determine the length of service life necessary if the depreciation used is the SYD method ?

• (A)  7 eyars
• (B)  8 years
• (C)  9 years
• (D)  10 years

Answer

Submitted By :Ali Uppal

A machine costs of P 8,000 and an estimated life of 10 years with a salvage value of P 500. What is its book value after 8 years using straight line method ?

• (A)  P 2,000.00
• (B)  P 2,100.00
• (C)  P 2,200.00
• (D)  P 2,300.00

Answer

Submitted By :Ali Uppal