Correct Answer:
B. Allocate the cost of a non-current asset over its useful life
Depreciation is an allocation of cost, not a valuation or a cash reserve.
November 13, 2026 · Accounting and Finance MCQs, Financial Accounting MCQs
The main purpose of depreciation is to:
Related MCQs
The normal balance of an asset account is:
A.
Debit
B.
Credit
C.
Zero
D.
Either debit or credit depending on the month
Correct answer is:
A. Debit
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Under the Constitution of Pakistan, the Auditor-General can be removed from office:
A.
In the like manner and on the like grounds as a judge of the Supreme Court
B.
By any minister
C.
By the Prime Minister alone
D.
By the Chief Secretary
Correct answer is:
A. In the like manner and on the like grounds as a judge of the Supreme Court
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Re-appropriation means:
A.
Transfer of funds from one head or sub-head to another within the same grant
B.
Returning all money to the treasury
C.
Taking a new foreign loan
D.
Writing off bad debts
Correct answer is:
A. Transfer of funds from one head or sub-head to another within the same grant
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Cost of goods sold is calculated as:
A.
Opening inventory - purchases + closing inventory
B.
Opening inventory + purchases - closing inventory
C.
Purchases + sales - closing inventory
D.
Sales - closing inventory
Correct answer is:
B. Opening inventory + purchases - closing inventory
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Audit sampling means applying audit procedures to:
A.
Every item in the population
B.
Only the largest item in the population
C.
Less than 100% of items in a population so that all sampling units have a chance of selection
D.
Items chosen by management
Correct answer is:
C. Less than 100% of items in a population so that all sampling units have a chance of selection
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A proportional (flat) tax:
A.
Charges higher rates on higher incomes
B.
Charges the same percentage rate at all income levels
C.
Charges lower rates on higher incomes
D.
Exempts all incomes
Correct answer is:
B. Charges the same percentage rate at all income levels
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