Correct Answer:
A. Assets = Liabilities + Equity
Resources owned by a business (assets) are financed by outsiders (liabilities) and owners (equity).
November 13, 2026 · Accounting and Finance MCQs, Financial Accounting MCQs
The basic accounting equation is:
Related MCQs
Under the imprest system of petty cash, the petty cash is:
A.
Never reimbursed
B.
Kept without a limit
C.
Reimbursed periodically to restore it to a fixed amount
D.
Recorded only in the ledger
Correct answer is:
C. Reimbursed periodically to restore it to a fixed amount
Do you agree with this answer?
In zero-based budgeting, managers must:
A.
Add a fixed percentage to last year's budget
B.
Justify every budgeted item from zero in each budget period
C.
Use only last year's figures
D.
Avoid preparing a budget
Correct answer is:
B. Justify every budgeted item from zero in each budget period
Do you agree with this answer?
The accounts of the Federation are compiled by:
A.
The Securities and Exchange Commission
B.
The Pakistan Bureau of Statistics
C.
The Election Commission
D.
The Controller General of Accounts
Correct answer is:
D. The Controller General of Accounts
Do you agree with this answer?
Which of the following is NOT a component of internal control in the COSO framework?
A.
Audit sampling
B.
Control environment
C.
Risk assessment process
D.
Monitoring of controls
Correct answer is:
A. Audit sampling
Do you agree with this answer?
According to Musgrave, the three functions of government in public finance are:
A.
Taxation, borrowing and lending
B.
Allocation, distribution and stabilization
C.
Defense, health and education
D.
Revenue, expenditure and debt
Correct answer is:
B. Allocation, distribution and stabilization
Do you agree with this answer?
A by-product is a product that:
A.
Has the greatest sales value of all products
B.
Is produced after the split-off by choice
C.
Cannot be sold
D.
Has a relatively minor sales value compared with the main product
Correct answer is:
D. Has a relatively minor sales value compared with the main product
Do you agree with this answer?
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