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Thanks Stefan and localghost:

That was the error! It was using the dvips driver. Removing it helps but am wondering if it will have any other adverse effect on the document?
I am sorry if i do not understand it correctly but I started using LaTeX just 10 days ago.

Cheers!

I am trying to use \includegraphics to include png/pdf images into my document using PdfTex in Texshop. But I keep getting an error message saying

!LaTeX error: Cannot determine size of graphic in figures/Test2.png (no BoundingBox).

I am using a template that has been created by someone for ...