A type of bond issued jointly by two or more The 72 rule is used to determine

corporations.
A. How many years money will triple
A. Joint bond B. How many years money will double
B. Debenture bond C. How many years to amass 1 million
C. Registered bond D. How many years to quadruple the money
D. Collateral trust bond
Ans. B
Ans. A
To triple the principal one must use
A type of bond whose guaranty is in lien on
railroads equipments. A. Integration
B. Derivatives
A. Equipment obligation bond C. Logarithms
B. Debenture bond D. Implicit functions
C. Registered bond
D. Insfrastructure bond Ans. C

Ans. A A currency traded in a foreign exchange market

to which the demand is consistently high in
If the security of the bond is a mortgage on relation to its supply.
certain specified asset of a corporation, this
bond is classified as A. Money market
B. Hard currency
A. Registered bond C. Treasury bill
B. Mortgage bond D. Certificated of deposit
C. Coupon bond
D. Joint bond Ans. B

Ans. B Everything a company owns to which has a money

value is classified as an asset. Which of the
A type of bond where the corporation’s owners following is classified as an asset?
name are recorded and the interest is paid
periodically to the owners with their asking A. Intangible asset
for it. B. Fixed asset
C. Trade investments
A. Registered bond D. All of these
B. Preferred bond
C. Incorporators bond Ans. D
D. All of these
Which of the example of an intangible asset?
Ans. A
A. Cash
Bond to which are attached coupons indicating B. Investment in subsidiary companies
the interest due and the date when such C. Furnitures
interest is to be paid. D. Patents

A. Registered bond Ans. D

B. Coupon bond
C. Mortgage bond Land buildings, plants and machinery are
D. Collateral trust bond examples of

Ans. B A. Current assets

B. Trade investments
An amount of money invested at 12% interest C. Fixed assets
per annum will double in approximately D. Intangible assets

A. 4 years Ans. C
B. 5 years
C. 6 years
D. 7 years

Ans. C
An increase in the value of a capital asset is The residual value of a company’s assets after
called all outside liabilities (shareholders
excluded)m have been allowed for.
A. Profit
B. Capital gain A. Divided
C. Capital expenditure B. Equity
D. Capital stock C. Return
D. Par value
Ans. B
Ans. B
The reduction in the money value of a capital
asset is called A saving which takes place because good are
not available for consumption rather than the
A. Capital expenditure consumer really want to save.
B. Capital loss
C. Loss A. Compulsory saving
D. Deficit B. Consumer saving
C. Forced saving
Ans. B D. All of these

It is negotiable claim issued by bank in lieu Ans. C

of a team deposit.
A document that shows proof of legal ownership
A. Time deposit of a financial security.
B. Bond
C. Capital gain A. Bond
D. Certificate of deposit B. Bank note
C. Coupon
Ans. D D. Check

Any particular raw materials or primary Ans. C

product (e.g. cloth, wool, flour, coffee..)
is called Defined as the capacity of commodity to
satisfy human want.
A. Utility
B. Necessity A. Discount
C. Commodity B. Necessity
D. Stock C. Luxuries
D. Utility
Ans. C
Ans. B
If denotes the fall in the exchange rate of
one currency in terms of others. The term It is the profit obtained by selling stocks at
usually applies to floating exchange rates. a higher price than its original purchase
price.
A. Currency appreciation
B. Currency devaluation A. Debenture
C. Currency float B. Goodwill
D. Currency depreciation C. Capital gain
D. Internal rate of return
Ans. D
Ans. C
The deliberate lowering of the price of a
nation’s currency in terms of the accepted The quantity of a certain commodity that is
standard (Gold, American dollar or the British offered for sale at a certain price at a given
pound). time and place.

A. Currency appreciation A. Demand

B. Currency float B. Supply
C. Currency devaluation C. Utility
D. Currency depreciation D. Market

Ans. C Ans. B
The quantity of a certain commodity that is A. 3 months or less
bought at a certain price at a given time and B. 1 year or less
place. C. 5 years or less
D. 10 years or less
A. Demand
B. supply Ans. C
C. market
D. Utility In the cash flow, expenses incurred before
time = 0 is called
Ans. A
A. Receipts
“When free competition exists, the price of a B. Disbursements
product will be that value where supply is C. Sunk costs
equal to the demand D. Firsts costs

A. Law of diminishing return Ans. C

B. Law of supply
C. Law of demand An imaginary cost representing what will not
D. Law of supply and demand be received if a particular strategy is
rejected.
Ans. D
A. Sunk cost
“When one of the factors of production is B. Opportunity cost
fixed in quantity or is difficult to increase, C. Replacement cost
increasing the others factors of production D. Initial cost
will result in a less than proportionate
increase in output.” Ans. B

A. Law of diminishing return In replacement studies, the existing process

B. Law of supply or piece of equipment is known as
C. Law of demand
D. Law of supply and demand A. Challenger
B. Defender
Ans. A C. Liability
D. Asset
An accounting term that represents an
inventory account adjustments. Ans. B

A. Cost of goods sold In replacement studies, the new process or

B. Variance piece of equipment being considered for
C. Overhead purchase is known as.
D. Payback
A. Challenger
Ans. A B. Defender
C. Asset
The simplest economic order quantity (EOQ) D. Liability
model is based on which of the following
assumptions. Ans. A

A. Shortages are not allowed. _______ means that the cost of the asset is
B. Demand is constant with respect to time. divided into equal or unequal parts, and only
C. Reordering is instantaneous. The time one of these parts is taken as an expense each
between order placement and receipt is year.
zero.
D. All of the choices A. Capitalizing the asset
B. Expensing the asset
Ans. D C. Depreciating the asset
D. Artificial expense

Ans. A

Indicate the CORRECT statement about

In economics, a “short – term” transaction depreciation.
usually has a lifetime of
 A. The depreciation is not the same each
year in straight line method.
B. The declining balance method can be used
even if the salvage calue is zero.
C. The sum-of-years’ digit method (SYD),
the digits 1 to (n + 1) is summed.
D. Double declining balance depreciation is
independent of the salvage value.
Ans. D
A. General, selling and administrative
expenses
B. Prime cost
C. Operating and maintenance costs
D. Total cost
Ans. C
The sum of the direct labor cost and the
direct material cost is known as

An artificial deductible operating expense A. Prime cost

designated to compensate mining organizations B. Total cost
for decreasing mineral reserves. C. Indirect manufacturing expenses
D. Total cost
A. Deflation
B. Reflation Ans. A
C. Depletion
D. Inflation Research and development costs and
administrative expenses are added to the
Ans. C factory cost to give the _______ of the
product.
The change in cost per unit variable change is
known as A. Total cost
B. Marketing cost
A. Sunk cost C. Manufacturing cost
B. Incremental cost D. Prime cost
C. Fixed cost
D. Semi-variable cost Ans. C

What type of cost increases step-wise? The sum of the prime cost and the indirect
manufacturing cost is known as
A. Supervision cost
B. Direct labor cost A. Factory cost
C. Semi-variable cost B. Research and development cost
D. Operating and maintenance cost C. Manufacturing cost
D. Total cost
Ans. C
Ans. A
Which of the following is NOT a variable cost?
The manufacturing cost plus selling expenses
A. Cost of miscellaneous supplies equals
B. Income taxes
C. Payroll benefit costs A. Total cost
D. Insurance costs B. Indirect production cost
C. Administrative cost
Ans. D D. Miscellaneous cost

Which of the following is Not a fixed cost? Ans. A

A. Rent Which of the following is NOT a direct labor

B. Janitorial service expenses expense?
C. Supervision costs
D. Depreciation expenses A. Inspection
B. Testing
Ans. C C. Supervision
D. Assembly

Ans. C

All are administrative expenses EXCEPT:

The annual costs that are incurred due to the
functioning of a piece of equipment is known A. Marketing
as B. Accounting
 C. Data processing C. Bookkeeping system
D. Office supplies D. Balance sheet

Ans. A Ans. B

One of the following is NOT a selling or The basic accounting equation is

marketing expense. Which one?
A. Assets = Liability + Owner’s equity
A. Advertising B. Liability = Assets + Owner’s equity
B. Commission C. Owner’s equity = Assets + Liability
C. Insurance D. Owner’s equity = Liability – Assets
D. Transportation
Ans. A
Ans. C
The ability to convert assets to cash quickly
Research and development expenses includes all is known as
EXCEPT one. Which one?
A. Solvency
A. Testing B. Liquidity
B. Drafting C. Leverage
C. Prototype D. Insolvency
D. Laboratory
Ans. B
Ans. D
The ability to meet debts as they become due
Which is not a factory overhead expense? is known as

A. Pension, medical, vacation benefits A. Solvency

B. Expediting B. Leverage
C. Quality control and inspection C. Insolvency
D. Testing D. Liquidity

Ans. D Ans. A

Bookkeeping consists of two steps, namely What is considered as an index of short-term

recording the transactions and categorization paying ability?
of transactions. Where are the transactions
(receipts and disbursements? Recorded? A. Current ratio
B. Acid test ratio
A. Journal C. Gross margin
B. Ledger D. Return of investment
C. Columnar
D. Statement of account Ans. A

Ans. A An acid test ratio is a ratio of

The following are ledger accounts EXCEPT: A. Gross profit to net sales
B. Net income before taxes to net sales
A. Asset accounts C. Quick assets to current liabilities
B. Bank accounts D. Net income to owner’s liabilities
C. Liability accounts
D. Owner’s equity accounts Ans. C

Ans. B

The journal and the ledger together are known The ratio of the net income to the owner’s
simply as _____ of the company. equity is known as

A. Accounting system A. Price-earning ratio

B. The books B. Profit margin ratio
 C. Return of investment D. Partnership
D. Gross margin
Ans. A
Ans. C
A document which shows the legal ownership of
Payback period is the ratio of financial security and entitled to payments
thereon.
A. Initial investment to net annual profit
B. Cost of goods sold to average A. Coupon
Cost of inventory on hand B. Contract
C. gross profit to net sales C. Bond
D. net income before taxes to net sales D. Consol

Ans. A Ans. A

A secondary book of accounts the information A government bond which have an indefinite
of which is obtained from the journal life rather than a specific maturity

A. Balance sheet A. Coupon

B. Ledger B. T-bill
C. Worksheet C. Debenture
D. Trial balance D. Consol

Ans. B Ans. D

The present worth of cost associated with an Refers to the orders quantity that minimizes
asset for an infinite period of time is the inventory cost per unit time.
referred to as
A. Economic order quantity
A. Annual cost B. Social order quantity
B. Capitalized cost C. Public order quantity
C. Increment cost D. Private order quantity
D. Operating cost
Ans. A
Ans. B
What is referred to as an individual who
A stock of a product which is held by a trade organizes factors of production to undertake a
body or government as a means of regulating venture with a view to profit?
the price of that product.
A. Agent
A. Stock pile B. Entrepreneur
B. Hoard stock C. Salesman
C. Buffer stock D. Commissioners
D. Withheld stock
Ans. B
Ans. C
The money that is inactive and does not
A negotiable claim issued by a bank in lieu of contribute to productive effort in an economy
a term deposit is called is known as

A. Cheque A. Idle money

B. T-bills B. Hard money
C. Currency C. Soft currency
D. Certificate of deposit D. Frozen asset

Ans. D Ans. A

A form of business firm which is owned and run In counting the number of days when computing
by a group of individuals for their mutual simple interest,
benefit
A. The first day is included
A. Cooperative B. The last day is excluded
B. Corporation C. The first day is included and the last
C. Enterprise day is excluded
 D. The first day is excluded and the last Ans. B
day is included
What is an annuity whose payments extend over
Ans. D a period of time whose length cannot be
foretold accurately?
In the so-called “Banker’s Rule”,
A. Annuity certain
A. The number of days in 1 year is 360 days B. Annuity uncertain
B. The number of days in 1 year is 365 days C. Incremental annuity
C. The number of days in each month is 30 D. Contingent annuity
days
D. The number of days in 1 year is 366 days Ans. D

Ans. A What do you call the time between successive

payment dates of an annuity?
To discount an amount F for n conversion
periods means A. Period interval
B. Annuity period
A. To find the present value on a day which C. Payment interval
is n periods after F is due D. Annuity term
B. To find the present value on a day which
is n periods before F is due Ans. C
C. To find the present value on a day which
is (n-1) periods before F is due The time from the beginning of the first
D. To find the present value on a day which payment interval to the need of the last one
is (n+1) periods before F is due is called the _____ of the annuity.
Ans. B
A. Period
In the formula for compound interest, F= P B. Term
(1+i)n, the value (1+i)n is called ____. C. Nature
D. Type
A. Discount factor
B. Interest factor Ans. B
C. Accumulation factor
D. Increase factor What refers to the extinction of the debt by
any satisfactory set of payments?
Ans. C
A. Liquidation
To find the present worth of a future amount B. Liability discharge
in compound interest, we use the formula C. Discharging debt
P=F(1+i)-n. What do you call the factor (1+i)- D. Amortization of debt
n?
Ans. D
A. Discount
B. Accumulation factor
C. Interest factor
D. Reduction factor

Ans. A

What do you call a fund, usually by periodic

What refers to an equation stating that the
deposits, to insure the accumulation of money
sum of the values, on a certain comparison
to provide for possible large payments?
date, of one set of obligations is equal to
the sum of the value of another set of this
A. Escrow fund
date?
B. Sinking fund
C. Mutual fund
A. Equality of value
D. Corporate fund
B. Equation of value
C. Equality equation
Ans. B
D. Similarity equation
What is the term for the borrowed principal D. When the price of the bond is either
usually mentioned in a typical bond? equal to or greater than the redemption
value.
A. Bond rate
B. Face value Ans. A
C. Coupon rate
D. Coupon value Which of the following will happen if bond is
bought at a discount?
Ans. B
A. Each coupon payment is too small to pay
Any date on which a coupon of a bond becomes all interest due on the investor’s
due will be referred to as a _____. principal.
B. Each coupon payment is greater than the
A. Maturity date interest due on the investor’s
B. Term of the bond principal.
C. Coupon date C. The unpaid interest on each coupon date
D. Due date will not be considered as a new
investment in the bond.
Ans. C D. The difference between the coupon
payment and the interest due is a
If P is the price of a bond and V is its
partial repayment of principal.
redemption value, what do you call the value
P-V? Ans. A

A. Par value In the sale of a bond, the actual purchase

B. Face value price on any day is called ____.
C. Premium
D. Bond discount A. Face value
B. Quoted price
Ans. C C. Accrued price
D. Flat price

Ans. D
When can we say that the bond is purchased at
a discount? What do you call the difference between the
flat price of the bond and the quoted price
A. When the price of the bond is greater
of the bond?
than the redemption value.
B. When the price of the bond is less than A. Par value
the redemption value. B. Accrued interest
C. When the price of the bond is equal than C. Bond rate
the redemption value. D. And-interest price
D. When the price of the bond is either
equal to or greater than the redemption The quoted price of a bond is sometimes called
value. _______.

Ans. B A. Par value

B. Face value
C. An-interest price
D. Coupon price

Ans. C
When can we say that the bond is purchased at
a premium? The yield of a bond is obtained by which of
the following formulas:
A. When the price of the bond is greater
than the redemption value. A. Average investment__
B. When the price of the bond is less than Average annual interest
the redemption value.
C. When the price of the bond is equal than B. Average annual interest_
the redemption value. Average investment

C. Par value_
 Flat value The acid test ratio is also known as quick
ratio. Which one represents the quick ratio?
D. Par value_
Flat value A. Quick assets_____
Current liabilities
Ans. B
B. Net credit sales___
What is a bond whose face value is redeemable Average net receivables
in installments, with interest payable
periodically as due on outstanding principal? C. Gross profit____
Current liabilities
A. Annuity bond
B. Serial bond D. Gross profit__
C. Treasury bond Net sales
D. Government bond
Ans. A
Ans. B
Which of the following represents the gross
What is the term for the sum of depreciation margin?
charges to date?
A. Net income__
A. Accrued depreciation Owner’s equity
B. Applied depreciation
C. Accumulated depreciation B. Net credit sales___
D. All of the above Average net receivables

Ans. A C. Gross profit__

Current liabilities
The difference between the value of an asset
and its salvage or scrap value at the end of
D. Gross profit__
the year is called ____.
Net sales
A. Depreciation
Ans. D
B. Accrued value
C. Book value A receivable turnover is calculated using
D. Wearing value which of the following formulas?

Ans. D A. Net income__

Owner’s equity
What is a life annuity?
B. Net credit sales___
A. A sequence of payment for a certain
Average net receivables
person which stops when person dies.
B. A sequence of payment intended for a
C. Gross profit__
life insurance of a person.
Current liabilities
C. A sequence of payment for a certain
person which continues indefinitely.
D. Gross profit__
D. It is the same as perpetuity.
Net sales
Ans. A
Ans. B
What term is usually used by the banks to
The percentage of each peso of sales that is
represent the effective interest rate per
net income is called ______.
period?
A. Price-earning ratio
A. Yield
B. Profit margin
B. Nominal rate
C. Profit margin ratio
C. Fixed rate
D. Return of investment ratio
D. Net rate
Which one represents that price-earnings
Ans. A
ratio?

A. Market price per share_

 Earnings per share What refers to the fall in the general price
level, frequently accompanied by a reduction
B. Earnings per share___ in the level of national income?
Market price per share
A. Inflationary gap
C. Net credit sales__ B. Dissavings
Average net receivables C. Disinflation
D. Inflation
D. Gross profit_____
Current liabilities Ans. C

Ans. A A price for a product just covers its

production and distribution costs with no
The book value per share of common stock is profit margin added.
the ratio of the common shareholders’
equity to ______. A. Cost price
B. Actual price
A. Average shared C. Real price
B. Number of outstanding shares D. Original price
C. Total subscribed shared
D. Authorized capital stock Ans. A

Ans. B A market where new entrants face cost similar

to those of established firms and where, on
What refers to the price at which the quantity leaving, firms are able to recoup their
demanded of a good is exactly equal to the capital costs, less depreciation.
quantity supplied?
A. Free market
A. Equilibrium market price B. Competitive market
B. Fair market price C. Limited market
C. Real market price D. Contestable market
D. Exact market price
Ans. D
Ans. A
What refers to a temporary grouping of
A principle that states that consumers will independent firms, organization and
tend to spend an increasing proportion of any governments, brought together to pool their
additional income upon luxury goods and a resources and skills in order to undertake a
smaller proportional on staple goods, so that particular project?
a rise in income will lower the overall share
of consumer expenditures spent on stable goods A. Consortium
(such as basic foodstuffs)and increase the B. Cartel
share of consumer expenditures on luxury goods C. Cooperative
(such as motor cars). D. Union

A. Placibo effect Ans. A

B. Luxury effect
C. Engel’s law
D. Staple law
What refers to a market for buying and selling
of raw materials such as tea, coffee, iron
Ans. C
ore, etc.?
What is the disciple within economics that
A. Commodity market
attempts to measure and estimate statistically
B. Raw market
the relationship between two or more economic
C. Natural market
variables?
D. National market
A. Theory of values
Ans. A
B. Econometrics
C. Economatics
D. Econoscience

Ans. B
 The paper currency issued by the central bank a. Balance sheet
which forms the part of the country’s money b. In-place value
supply c. Check and balance
a. T-bills d. Break even-no gain no loss
b. Bank note
c. Check Ans. D
d. Coupon
Kind of obligation which has no condition
Answer B attached.
a. Analytic
Reduction in the national income and output b. Pure
usually accompanied by the fall in the c. Gratuitous
general proce level d. Private
a. Devaluatio
b. Deflation Ans. C
c. inflation
d. Depreciation Direct labor costs incurred in the factory
and direct material costs are the costs of
Ans. B all materials that go into production. The
sum of these two direct costs is known as
It is a series of equal payment occurring at a. GS and A expenses
equal interval of time b. Operating and maintenance costs
a. Annuity c. Prime cost
b. Debt d. O and M costs
c. Amortization
d. Deposit Ans. C

Ans. A An index of short term paying ability is

called
The place and buyers come together a. Receivable turn-over
a. Market b. Profit margin ratio
b. Business c. Current ratio
c. Recreational center d. Acid-test ratio
d. Buy and sell of section
Ans. D
Ans A
An artificial expenses that spreads the
A market where by there is only one buyer of purchase price of an assets or another
an item for which there are no good property over a number of years.
substitute a. Depreciation
a. Monopsony b. Sinking Fund
b. Oligopoly c. Amnesty
c. Monopoly d. Bond
d. Oligopsony
Ans. A
Ans A

Estimate value at the end of the useful life.

It is a series of equal payment occurring at a. Market value
equal interval of time where the first b. Fair value
paymenyt is made after several periods, after c. Salvage value
the beginning of the payment d. Book value
a. Perpetuity
b. Ordinary Annuity Ans. C
c. Annuity due
d. Deferred annuity Consists of the actual counting or
determinination of the actual quantity of the
ans.D materials on hand as of a given date.
a. Physical inventory
The total income equals the total operating b. Material update
cost. c. Technological assessment
 d. Material count
Ans. C
Ans. A
Decrease in the value of a physical property
Additional information of prospective bidders due to the passage of time.
on contract documents issued prior to bidding a. Inflation
date. b. Depletion
a. Delict c. Recession
b. Escalatory d. Depreciation
c. Technological assessment
d. Bid bulletin Ans. D

Ans. D An association of two or more individuals for

the purpose of operating a business as co-
A series of uniform accounts over an infinite owners for profit.
period of time. a. Sole proprietorship
a. Depreciation b. Company
b. Annuity c. Partnership
c. Perpetuity d. Corporation
d. Inflation
Ans. C
Ans. C
We may classify an interest rate, which
The quantity of a certain commodity that is specifies the actual rate of interest on the
offered for sale at a certain price at a principal for one year as
given place and time. a. Nominal rate
a. Demand b. Rate of return
b. Supply c. Exact interest rate
c. Stocks d. Effective rate
d. Goods
Ans. D
Ans. B
It is defined to be the capacity of a
Work-in process is classified as commodity to satisfy human want.
a. An assets a. Discount
b. A liability b. Luxury
c. An expenses c. Necessity
d. An owner’s equity d. Utility

Ans. A Ans. B

It is the amount which a willing buyer will

What is the highest position in the pay to a willing seller or a property where
corporation? each has equal advantage and is under no
a. President compulsion to buy or sell.
b. Board of directors a. Fair value
c. Chairman of the board b. Market value
d. Stockholders c. Book value
d. Salvage value
Ans. C
Ans. B
Type of ownership in business where
individuals exercise and enjoy the right in This occurs in a situation where a commodity
their own interest. or service is supplied by a number of vendors
a. Equitable and there is nothing to prevent additional
b. Public vendors entering the market.
c. Private a. Perfect competition
d. Pure b. Oligopoly
 c. Monopoly Money paid for the use of borrowed capital.
d. Elastic demand a. Discount
b. Credit
Ans. A c. Interest
d. Profit
These are product or service that are desired
by human and will be purchased if money is a Ans. C
available after the required necessities have
been obtained. Liquid assets such as cash and other assets
a. Utilities that can be converted quickly into cast such
b. Necessities as accounts receivable and merchandise are
c. Luxuries called
d. Product goods and service a. Total assets
b. Fixed assets
Ans. C c. Current assets
d. None of the above
These are product or services that are
required to support human life ad activities Ans. C
that will be purchased in somewhat the same
quantity even though the price varies The length of time which the property may be
considerably. operated at a profit.
a. Utilities a. physical life
b. Necessities b. Economic life
c. Luxuries c. Operating life
d. Product goods and services d. All of the above

Ans. B Ans. B

A condition where only few individuals The provision in the contract that indicates
produce a certain product and that any action the possible adjustment of material cost and
of one will lead to almost the same action of labor cost.
the others. a. Secondary clause
a. Oligopoly b. Esclatory clause
b. Semi-monopoly c. Contingency clause
c. Monopoly d. Main clause
d. Perfect competition
Ans. B
Ans. A

The present worth of all depreciation over

Grant total of the assets and operational the economic life of the item is called
capability of a corporation. a. Book value
a. Authorized capital b. Capital recovery
b. Investment c. Depreciation recovery
c. Subscribed capital d. Sinking fund
d. Money market
Ans. C
Ans. A
Gross profit, sales less cost of goods sold,
The worth of the property equals to the as a percentage of sales is called
original cost less depreciation. a. Profit margin
a. Scrap value b. Gross margin
b. Face value c. Net income
c. Market value d. Rate of return
d. Book value
Ans. B
Ans. D
Worth of the property as shown in the The cumulative effect of elapsed time on the
accounting records of an enterprise. money value of an event, based on the earning
a. Fair value power of equivalent investment funds capital
b. Market value should or will earn.
c. Salvage value a. Present worth factor
d. Book value b. Interest rate
c. Time value of money
Ans. D d. Yield

Those funds that are required to make the Ans. C

enterprise or project a going concern.
a. Initial investment Defined as the future value minus the present
b. Current accounts value.
c. Working capital a. Interest
d. Subscribed capital b. Rate of return
c. Discount
Ans. C d. Capital

A market situation where there are one seller Ans. C

and many buyers.
a. Monopoly The flow back of profit plus depreciation
b. Monopsony from a given project is called.
c. Oligopoly a. Capital recovery
d. Oligopsony b. Cash flow
c. Economic flow
Ans. A d. Earning value

A market situation where there are few Ans. B

sellers and few buyers.
a. Oligopoly The profit derived from a project or business
b. Oligopsony enterprise whithout consideration of
c. Bilateral oligopoly obligations to financial contribution or
d. Bilateral oligopsony claims of other based on profit.
a. Economic life
Ans. C b. Yield
c. Earning value
d. Expected yield

Ans. A

A market situation where there is one seller The payment for the use of borrowed money is
and one buyer. called
a. Monopoly a. Loan
b. Monopsony b. Maturity value
c. Bilateral monopoly c. Interest
d. Bilateral monopsony d. Principal

Ans. C Ans. C

A market situation where there are only two The interest rate at which the present work
buyers with many sellers. of the cash flow on a project is zero of the
a. Duopoly interest earned by an investment.
b. Oligopoly a. Effective rate
c. Duopsony b. Nominal rate
d. Oligopsony c. Rate of return
d. Yield
Ans. C
Ans. C
The ratio of the interest payment to the b. Fair value
principal for a given unit of time and c. Goodwill value
usually expressed as a percentage of the d. Going value
principal.
a. Interest Ans. D
b. Interest rate
c. Investment The value which a disinterested third party,
d. All of the above different from the buyer and seller, will
determine in order to establish a price
Ans. B acceptable to both parties.
a. Market value
The true value of interest rate computed by b. Good value
equations for compound interest for a 1 year c. Fair value
period is known as d. Franchise value
a. Expected return
b. Interest Ans. C
c. Nominal interest
d. Effective interest A type annuity where the payments are made at
the end of each payment period starting from
Ans. D the first period.
a. Ordinary annuity
The intangible item of value from the b. Annuity due
exclusive right of a company to provide a c. Deferred annuity
specific product or service in a stated d. Perpetuity
region of the country.
a. Market value Ans. A
b. Book value
c. Goodwill value It is a series of time where the first
d. Franchise value payment is made after several periods, after
the beginning of the payment.
Ans. D a. Deferred annuity
b. Delayed annuity
The recorded current value of an asset is c. Progressive annuity
known as d. Simple annuity
a. Scrap value
b. Salvage value Ans. A
c. Book value
d. Present wort

Ans. C A type of annuity where the payments are made

at the start of each period from the first
Scrap value of an asset is sometimes known period.
as. a. Ordinary annuity
a. Book value b. Annuity due
b. Salvage value c. Deferred annuity
c. Replacement value d. Perpetuity
d. Future value
Ans. B
Ans. B
Which is not an essential element of an
What is sometimes called second hand value? ordinary annuity?
a. Scrap value a. The amounts of all payments are
b. Salvage value equal.
c. Book value b. The payments are made at equal
d. Going value interval of time
c. The first payment is made at the
Ans. B beginning of each period
d. Compound interest is paid on all
An intangible value which is actually amounts in the annuity
operating concern has due to its operation.
a. Book value Ans. C

A is a periodic payment and I is the interest
rate, then present worth of a perpetuity =
a. Ai
b. Ai^n
c. A^n/ i
d. A/i
Ans. D
A mathematical expression also known as the
present value of one is called
a. Load factor
b. Demand facetor
c. Sinking fund factor
d. Present worth factor
Ans. D
As applied to a capitalized asset, the
distribution of the initial cost by a
periodic changes to operation as in
depreciation or reduction of a debt by either
periodic or irregular prearranged program is
called
a. Annuity
b. Capital recovery
c. Annuity factor
d. Amortization
Ans. D
The reduction of the value of an asset due to
constant use and passage of time.
a. Scrap value
b. Depletion
c. Depreciation
d. Book value
Ans. C
A method of computing depreciation in which
the annual charge is a fixed percentage of
the depreciated book value at the beginning
of the year to which the depreciation
applies.
a. Straight line method
b. Sinking fund method
c. SYD method
d. Declining balance method
Ans. D
A method of depreciation whereby the amount
to recover is spread uniformly over the
estimated life of the asset in terms of the
periods or units of output.
a. Straight line method
b. Sinking fund method
c. Declining balance method
d. SYD method
Ans. A
Which of the following depreciation methods
cannot have a salvage value of zero?
a. Declining balance method
b. Sinking fund method
c. Straight line method
d. SYD method
Ans. A
A method of depreciation where a fixed sum of
money is regularly deposited at compound
interest in a real or imaginary fund in order
to accumulate an amount equal to the total
depreciation of an asset at the end of the
asset’s estimated life.
a. Straight line method
b. Sinking fund method
c. Declining balance method
d. SYD method
Ans. B
The function of interest rate and time
determines the cumulative amount of a sinking
fund resulting from specific deposits.
a. Sinking fund factor
b. Present worth factor
c. Capacity
d. Demand factor
Ans. A
The first cost of any property includes
a. The original purchase price and
freight and transportation
charges
b. Installation expenses
c. Initial taxes and permits fee
d. All of the above
Ans. A
In SYD method, the sum of years digit is
calculated using which formua with n= number
of useful years of the equipment.
a. n(n-1)/2
 b. n(n+1)/2
c. n(n+1) Ans. C
d. n(n-1)
Which is NOT a type of business organization?
ans. B a. Sole proprietorship
b. Corporation
capitalized cost of any property is equal to c. Enterprise
the d. Partnership
a. annual cost
b. first cost + cost of perpetual Ans. C
cost
c. first cost + cost of perpetual What is the minimum number of incorporators
maintenance in order that a corporation be organized?
d. first cost + salvage value a. 3
b. 5
ans. C c. 10
d. 7
the lessening of the value of an asset due to
the decrease in the quantity available Ans. B
( referring to the natural resources, coal,
oil, etc)
a. depreciation
b. depletion
c. inflation
d. incremental cost

ans. B

is the simplest form of business organization

a. sole propeitorship
b. partnership
c. enterprise
d. corporation

ans. A In case of bankruptcy of a partnership

a. The partners are not liable for
an association of two or more person for a the liabilities of the
purpose of engaging in a profitable business partnership.
a. sole proprietorship b. The partnership assets (excluding
b. enterprise the partner personal assets) only
c. partnership will be used to pay the
d. corporation liabilities.
c. The partners personal assets are
Ans. C attached to the debt of the
partnership
a distinct legal entity which can practically d. The partners may sell stock to
transact any business transaction which a generate additional capital.
real person could do.
a. Sole proprietorship Ans. C
b. Enterprise
c. Partnership Which is TRUE about partnership?
d. Corporation a. It has a perpetual life.
b. It will be desolved if one of the
Ans. D partners ceases to be connected
with the partnership
Double taxation is disadvatange of which c. It can be handed down from one
business organization generation of partners to
a. Sole proprietorship another.
b. Partnership d. Its capitalization must be equal
c. Corporation for each partner.
d. Enterprise
 Ans. D c. Preferred stock
d. Common stock
Which is TRUE about corporation?
a. It is the not best form of Ans. A
business organization.
b. The minimum number of A form of fixed- interest security issued by
incorporators to start a central or local governments, companies,
corporation is there. banks or other institutions. They are usually
c. Its life is dependent on the a form of long-term security, buy may be
lives of the incorporators. irredeemable, secured or unsecured.
d. The stockholders of the a. Bonds
corporation are only liable to b. T-bills
the extent of their investments. c. Certificate of deposit
d. All of these
Ans. D
Ans. A
Represent ownership, and enjoys certain
preference than ordinary stock. A type of bond where the corporation pledges
a. Authorized capital stock securities which it owns (i.e. stock, bonds
b. Preferred stock of its subsidiaries)
c. Common stock a. Mortgage bond
d. Incorporator’s stock b. Register bond
c. Coupon Bond
Ans. B d. Collateral trust bond
Represent the ownership of stockholders who
have a residual claim on the assets of the Ans. D
corporation after all other claims have been
settled.
a. Authorized capital A type of bond which does not have security
b. Preferred stock except a promise to pay by the issuing
c. Incorporators stock corporation.
d. Common stock a. Mortgage bond
b. Register bond
Ans. D c. Collateral trust bond
d. Debenture bond
The amount of company’s profits that the
board of directors of the corporation decides Ans. C
to distribute to ordinary shareholders.
a. Dividend
b. Return
c. Share stock
d. Par value

Ans. A

A certified of indebtness of a corporation

usually for a period not less than 10 years
and guaranteed by a mortgage on certain
assets of the corporation.
a. Bond
b. T-bill
 ECONOMIC’S
FINAL COACHING

By Tiger’s Review Center