31. Alternative methods exist for the measurement of the pension obligation (liability). Which measure requires the use of future salaries in its computation?
(A) Vested benefit obligation
(B) Accumulated benefit obligation
(C) Projected benefit obligation
(D) Restructured benefit obligation
Ans. (C) Projected benefit obligation
32. The projected benefit obligation is the measure of pension obligation that
(A) Is required to be used for reporting the service cost component of pension expense.
(B) Requires pension expense to be determined solely on the basis of the plan formula
applied to years of service to date and based on existing salary levels.
(C) Requires the longest possible period for funding to maximize the tax deduction.
(D) Is not sanctioned under generally accepted accounting principles for reporting the service
cost component of pension expense.
Ans. (A) Is required to be used for reporting the service cost component of pension expense.
33. The purpose of financial markets is to:
(A) Control inflation
(B) Allocation savings efficiently
(C) Increase the price of common stocks
(D) Lower the yield on bonds
Ans. (B) Allocation savings efficiently
34. Assets are held for the purpose of:
(A) Earning revenue
(B) resale
(C) conversation into cash
(D) None of these
Ans. (A) Earning revenue
35. Depreciation is provided on:
(A) Fixed Asset
(B) Outward charges
(C) Current assets
(D) Intangible assets
Ans. (A) Fixed Asset
36. Deferred taxation is:
(A) Fixed Asset
(B) Fixed Liabilities
(C) Part of owners’ equity
(D) None of these
Ans. (C) Part of owners’ equity
37. Process of costing is relevant to:
(A) Cement Industry
(B) Job order cost-oriented projects
(C) Both (A & B)
(D) None of these
Ans. A) Cement Industry
38. Stratified audit sample means:
(A) Randomly selected items from audit
(B) Purposively selected items for audit
(C) Items carefully selected from each group
(D) None of these
Ans. (A) Randomly selected items from audit
39. Income tax rate are the same for:
(A) Limited companies
(B) Baking Companies
(C) Public Companies
(D) None of these
Ans. (B) Baking Companies
40. Leaders perform:
(A) Decisional roles
(B) Informal roles
(C) Informational roles
(D) International roles
Ans. (A) Decisional roles