PPSC Commerce Past Test Papers 2016

All the past PPSC Commerce Past Test Papers along with the answers. This section contains 70 questions.




PPSC Commerce Past Test Papers Part 1

1.) The closing balance of petty cash book is considered as
A) Liability
B) Asset
C) Expenses
D) Income

2.)Payment of rent expenses is recorded on which side of cash book?
A) Receipts
B) Payments
C) Income
D) Expense

3.) An entry which is made on both sides of a cash book is called
A) Cash entry
B) Contra entry
C) Payment entry
D) Compound entry

4.) A cash book with cash, bank and discount column is commonly referred as
A) Cash book
B) Two columns cash book
C) Three columns cash book
D) Petty cash book

5) Cash book records
A) Cash payments
B) Cash receipts
C) Cash payments and cash receipts
D) Neither cash payments nor cash receipts

6.) Cash discount is allowed on _______ repayment of debt
A) Lump sum
B) Prompt
C) Actual
D) None of them

7.) Cash book is prepared by
A) Bank
B) Accountant of business
C) Manager of a company
D) Bank’s cashier

8.) The most common imprest system is the ________ system
A) petty cash
B) Cash book
C) Cash receipt
D) Discount

9.)Discount received is recorded on which of the following side of a cash book?
A) Receipts
B) Payments
C) Incomes
D) Expenditures

10.) Drawings by owner of business are generally recorded on which of the following side of a cash book?
A) Receipts
B) Payments
C) Incomes
D) Expenditures




PPSC Commerce Past Test Papers Part 2

11.) Introduction capital by owner of business is recorded on which side of a cash book?
A) Receipts
B) Payments
C) Incomes
D) Expenditures

12.) Cash book with cash and discount column is mostly referred as
A) Simple cash book
B) Two column cash book
C) Three column cash book
D) Petty cash book

13.) A cash book that is used to record the small payments of cash is generally referred as
A) Simple cash book
B) Two column cash book
C) Three column cash book
D) Petty cash book

14.) A simple or one column cash book usually has which of the following main columns?
A) Bank
B) Payments
C) Discount
D) Cash

15.) Purchase of office equipment for cash will be recorded on which of the following sides of a cash book?
A) Receipts
B) Payments
C) Incomes
D) Expenditures

16.) Postdated checks are considered as
A) Cash
B) Bank balance
C) Accounts receivable
D) Cash reserve

17.) Postage stamps on hand are considered as
A) Bank
B) Prepaid expenses
C) Accounts receivable
D) Creditor

18.) Petty cash fund is supposed to be replenished
A) Every day
B) Every half year
C) Every year
D) At the end of every accounting period

19.) Which of the following is generally not the party to a check?
A) Payee
B) Payer
C) Bank
D) Seller

20.) A credit balance in cash book indicates
A) Bank balance
B) Cash at bank
C) Bank overdraft
D) Bank underdraft




PPSC Commerce Past Test Papers Part 3

21.)The accounting process involves in recording:
A) Quantifiable economic event
B) Non quantifiable economic event
C) All of them
D) None of them

22.) In accounting an Economic event is referred to as:
A) Cash
B) Bank statement
C) Transaction
D) Exchange of money

23.) Identify the correct sequence of accounting process
A) Communicating→Recording→Identifying
B) Recording→Communicating→Identifying
C) Identifying→communicating→recording
D) Identifying→recording→communicating

24.) Bookkeeping mainly concerns with which part of accounting process?
A) Analysing
B) Preparing financial statements
C) Recording financial information
D) Auditing the books of accounts

25.) Financial accounting provides financial information to all of the following external users except:
A) Government agencies
B) investors
C) Creditors
D) Managers

26.) For which step of accounting process the accountants of business entity prepare financial statements?
A) Identification of economic event
B) Communication of financial information
C) Recording financial information
D) Making decisions about business

27.) Keeping the log of financial information in books of original entries is called
A) Recording
B) summarizing
C) Grouping
D) Processing

28.) Auditing is what?
A) Reporting the financial information
B) Examination of financial statements
C) Preparation financial statements
D) maintaining the ledger records

29.) Which of the following is the external user of financial statements?
A) Manager of the business
B) CEO of the business
C) Creditor of the business
D) Controller of the business

30.) Which of the following is the internal user of financial statements?
A) Creditor of the business
B) Government agency
C) Shareholder of the business
D) Manager of the business




PPSC Commerce Past Test Papers Part 4

31.)_________ is the first phase of accounting cycle
A) Identifying an economic event or transaction
B) Preparing journals
C) Posting entries to ledger accounts
D) Making decisions about business

32.) Financial statements differ from management account because
A) They are mainly prepared for external users of financial information
B) They are more complex and hard to prepare
C) The are the summary of accounting data
D) The are prepared on basis of actual concept

33.) ________ is a separate legal entity that Total capital can be divided in many shares
A) Partnership
B) Sole proprietorship
C) Company
D) Non-profit organization

34.) An asset posses which of the following?
A) Future economic benefits for the business
B) All kind of benefits for the business
C) Expenses for the business
D) Merits and Demerits for the business

35 Liabilities are which of the following?
A) Resources
B) Obligations
C) Future benefits
D) Expenses

36.) ________ is the gross inflow of economic benefits
A) Assets
B) Liabilities
C) Income
D) Expenses

37.) The gross decrease in economic benefits for the business are what?
A) Expenses
B) Obligations
C) Creditors
D) Income or gain

38.) An asset must be _______ by the business to be shown as an asset in its “balance sheet”
A) Possessed
B) Owned
C) Controlled
D) Used

39.) Liability are arisen from which of the following events?
A) Present event
B) Future event
C) Past event
D) Non of them

40.) Which of the following can be considered as the most important phase of accounting cycle and it is the primarily objective of financial accounting?
A) Identifying transactions
B) Preparing “T Accounts”
C) Preparing financial statements
D) Preparing trial balances




PPSC Commerce Past Test Papers Part 5

41.) Which is the most important characteristic that all assets of a business have?
A) Long life of assets
B) Value of assets
C) Intangible nature of assets
D) Future economic benefits

42.) What is the basic accounting equation?
A) Capital+Liabilities=Assets
B) Assets+ liabilities =Capital
C) Capital+assets=liabilities
D) Liabilities+Capital

43.) Which of the following is a liability?
A) Cash
B) Equipment
C) Debtors
D) Creditors

44.) What is equity?
A) Cash from the business
B) liability of a business
C) Owner’s claim on total assets
D) Owner’s claim on total liabilities

45.) Identify the asset from the following
A) Cash and cash equivalent
B) Creditors
C) Notes payable
D) Bank loan

46.) _______ the withdrawal of cash and goods by the owner of the business for his/her personal use
A) Depreciation
B) Drawings
C) Outflow of cash
D) Appreciation

47.) Net loss occurs when
A) Expenses are greater than Income
B) Expenses are less than Income
C) Expenses=Income
D) Liabilities are greater than income

48.) Double entry implies that
A) Recording entries in journal
B) Recoding entries in Ledger account
C) Recording two aspects of every transaction
D) Recording every transaction in books

49.) Identify the nominal account

A) Machinery account
B) Building account
C) Creditors account
D) Rent expenses account

50.) Which of the following accounts can be classified as a real account?
A) Rent expenses account
B) Rent income account
C) insurance expenses account
D) Cash account




PPSC Commerce Past Test Papers Part 6

51.) Which of the following specialised journals records “goods returned by customers”?

A)  Purchase journal

B)  Sales journal

C)  Purchases return journal

D)  Sales return journal

52.) Sales on credit is recorded in which of the following journal?

A)  Purchase journal

B)  Sales journal

C)  Purchases return journal

D)  Sales return journal

53.) Transactions that a BUSINESS doesn’t record in any specialised journal are recorded in which of the following journals or day books?

A)  Cash payments journal

B)  Cash receipts journal

C)  Purchases return journal

D)  General journal

54.) Another name of journal is

A)  Specialized journal

B)  Day book

C)  Cash book

D)  Record book

55.) Which of the following specialised journals will record “goods returned by the BUSINESS “?

A)  Purchase journal

B)  Sales journal

C)  Purchases return journal

D)  Sales return journal

56.) Sales and purchase journal don’t record

A)  Credit sales

B)  Credit purchases

C)  Credit sales and purchases

D)  Cash sales and purchases

57.) Cash received from debtor is recorded in which of the following SPECIALIZED journals?

A)  Purchase journal

B)  Sales journal

C)  Cash receipts

D)  Cash payments journal

58.) Which of the following is a type of cash receipt journal + cash payment journal?

A)  Bank statement

B)  Statement of cash flow

C)  Cash book

D)  Cash documents

59.) Cash purchases is recorded in which of the following specialized journals?

A)  Purchase journal

B)  Sales journal

C)  Purchases return journal

D)  Cash payments journal

60.) A brief explanation recorded below every entry in  general journal is commonly known as

A)  Narration

B)  Explanation

C)  Summary

D)  Other information




PPSC Commerce Past Test Papers Part 7

61.) Credit purchase of plant and machinery is recorded in which of the following  journals?

A)  General journal

B)  Cash journal

C)  Purchase journal

D)  Purchase return journal

62.) Debit note is the basis for recording a transaction in which of the following journals?

A)  General journal

B)  Cash journal

C)  Purchase journal

D)  Purchase return journal

63.) SALE of old furniture” will be recorded in which of the following specialised journals?

A)  Purchase journal

B)  Sales journal

C)  General journal

D)  Cash receipt journal

64.) Credit note is the basis for recording a transaction in which of the following SPECIALIZED journals?

A)  Purchase journal

B)  Sales return journal

C)  General journal

D)  Cash receipt journal

65.) Specialized journals are more adequate for which TYPE OF BUSINESSES ?

A)  Small businesses

B)  Big businesses

C)  Sole proprietorship

D)  Partnership

66.) Which of the following is known as an evidence that a transaction took place?

A)  Cash receipts journal

B)  General journal

C)  Source document

D)  Cash book

67.) BUSINESS  paid rent amounting to $100″ which of the following specialized journals records this transaction?

A)  Cash receipts journal

B)  Cash payments journal

C)  Sales journal

D)  Purchase journal

68.) Credit memo or credit note No. is entered in which of the following journal?

A)  General journal

B)  Cash journal

C)  Purchase journal

D)  Sales return day book

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