Correct Answer:
B. Share premium
Share premium is a capital reserve arising from issue price above nominal value.
November 13, 2026 · Accounting and Finance MCQs, Financial Accounting MCQs
When shares are issued at a price above their par value, the excess is credited to:
Related MCQs
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?
Stock audit in a government department is intended to:
A.
Verify the physical existence and proper record of stores and stock
B.
Count cash in the treasury
C.
Check payroll only
D.
Verify tax assessments
Correct answer is:
A. Verify the physical existence and proper record of stores and stock
Do you agree with this answer?
The prudence (conservatism) concept suggests that a business should:
A.
Recognize all expected profits in advance
B.
Not overstate assets or income and not understate liabilities or expenses
C.
Ignore all expected losses
D.
Record assets at the highest possible value
Correct answer is:
B. Not overstate assets or income and not understate liabilities or expenses
Do you agree with this answer?
The Fiscal Responsibility and Debt Limitation Act, 2005 of Pakistan provides a target for:
A.
The ratio of total public debt to GDP
B.
The number of public employees
C.
The exchange rate
D.
The inflation rate only
Correct answer is:
A. The ratio of total public debt to GDP
Do you agree with this answer?
Propriety audit examines whether expenditure:
A.
Is the lowest in the world
B.
Has been approved by the Prime Minister
C.
Is paid in cash
D.
Is in line with standards of financial rectitude and sound financial principles, even if technically within rules
Correct answer is:
D. Is in line with standards of financial rectitude and sound financial principles, even if technically within rules
Do you agree with this answer?
Net profit is Rs. 50,000 and sales are Rs. 400,000. The net profit margin is:
A.
8%
B.
20%
C.
12.5%
D.
125%
Correct answer is:
C. 12.5%
Do you agree with this answer?
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