Research Methodology and Project Report - 2

Research Methodology and Project Report - 2


Multiple Choice Multiple Answer
Question The permanent requirement of working capital should be financed out of :-
Correct Answer Debentures , Cash Profits , Shares


Multiple Choice Multiple Answer
Question The sources of long term and medium term finance are :-
Correct Answer Equity shares , Public deposit


Multiple Choice Single Answer
Question The emphasis of the Banks and Financial institutions particularly in India has shifted from 'Sanctions', 'Disbursements' and 'Security-orientation' to 'Recovery/Recycling' and :-
Correct Answer Activity orientation


Multiple Choice Single Answer
Question Technology, design, layout of the plant as well as inputs and infrastructural facilities are to be considered under :-
Correct Answer Technical appraisal


Select The Blank
Question Detailed Project Report is generally prepared from a ________ report with additional information.
Correct Answer Feasibility


True/False
Question A high debt equity ratio may indicate that the financial stake of the creditors is more than that of the owners.
Correct Answer True


Multiple Choice Single Answer
Question The formula for Break Even Point is :-
Correct Answer Fixed cost / ( Sales Price - Variables)


Multiple Choice Single Answer
Question Receivables is categorised under :-
Correct Answer Current assets and liabilities


Multiple Choice Multiple Answer
Question Ratios relating to working capital are :-
Correct Answer Current ratio , Internal measure , Quick ratio


Select The Blank
Question Longer the duration of production cycle, higher the requirement of ________.
Correct Answer Working capital


Multiple Choice Multiple Answer
Question In the Detailed Project Report, Management aspects includes :-
Correct Answer Determination , Organisation Building , Person / system oriented


True/False
Question Financial analysis based on accounting ratios will give mis-leading results if the effects of changes in price level are not taken into account.
Correct Answer True


Multiple Choice Multiple Answer
Question In the Detailed Project Report, Technical aspects includes :-
Correct Answer Plant capacity , Quality standards , Raw material requirement


Select The Blank
Question Inflow of funds may not necessarily result in ________.
Correct Answer Inflow of cash


Multiple Choice Multiple Answer
Question Building cost consists of :-
Correct Answer Factory building , Auxiliary buildings , Administrative block


Match The Following
Question- Correct Answer


Increase in current liabilities -Decreases working capital

Increase in liabilities -Inflow of funds


Decrease in liabilities- Outflow of funds

Increase in current assets- Increases working capital


Select The Blank
Question Sometimes the term ________ is interpreted as cash equivalent i.e. cash and marketable securities.
Correct Answer Fund


True/False
Question Name of the finance manager comes under the Project organisation category of the Project report.
Correct Answer True


True/False
Question Change in the project concept itself may lead to cost and time overrun.
Correct Answer True


True/False
Question The maximum Seed Capital assistance provided by IDBI under the project will be restricted to 50% of the required promoter's contribution or Rs. 50 lakhs whichever is lower.
Correct Answer False


Match The Following
Question- Correct Answer


Project organization- Finance manager


General category of Project report- Location of factory


Cost aspect of the project report -Consultancy fees


Financing plan- Unsecured loans



True/False
Question Trend projection method is the important technique for forecasting demand.
Correct Answer True


Multiple Choice Multiple Answer
Question Production and sales aspect of Visit report consists of :-
Correct Answer Utilisation of installed capacity , Input availability , Sales trends


Multiple Choice Multiple Answer
Question The sources of cash are :-
Correct Answer Cash from operations , Sale of machinery , Issue of new shares


Multiple Choice Multiple Answer
Question External sources of cash are as follows :-
Correct Answer Issue of new shares , Long term loans , Short term borrowings


True/False
Question Production line diagrams show the organisation structure of the project along with information on location, personnel required for various departments, and their inter-relationship.
Correct Answer False


Select The Blank
Question ________ is a current asset
Correct Answer Book debts


Select The Blank
Question The company having ________, is appropriate for the strategic posture of Defensive under the SPACE approach.
Correct Answer Lacks both competitive advantage as well as financial strength and belongs to a not so attractive industry, operating in an unstable environment


Multiple Choice Single Answer
Question Management aspect of detailed project report includes
Correct Answer Organisation structure


Select The Blank
Question ________ profitability reduces the strain on working capital.
Correct Answer High


Multiple Choice Multiple Answer
Question The following are the sources of funds :-
Correct Answer Operating Profit , Non operating Income


Multiple Choice Single Answer
Question The cash flow of all the years during the expected life of the project are discounted at a pre-determined cut off rate and :-
Correct Answer Net Present value is obtained

Multiple Choice Multiple Answer
Question The objectives of the funds flow statement is as follows :-
Correct Answer To find out the uses of loans raised by the business , To indicate the financial strength and weakness of the business , To help to understand the changes in assets as well as asset sources which are not revealed by the income statement


Multiple Choice Single Answer
Question Cost of materials include :-
Correct Answer Cost of components and consumable stores


True/False
Question The Detailed Project report must indicate the gestation period of the project.
Correct Answer True


Multiple Choice Single Answer
Question Strategic Position and Action Evaluation Model :-
Correct Answer Is an approach to hammer out an appropriate strategic posture for a firm and its individual business


Select The Blank
Question Location of the factory comes under the ________ category of the Project report.
Correct Answer General


Select The Blank
Question Retained earnings is a source of ________ finance.
Correct Answer Internal


Multiple Choice Multiple Answer
Question General category of the Project report consists of :-
Correct Answer Name of the Industrial concern , Proposed product , Location of the factory



Select The Blank
Question Short term finance is normally for a period upto ________ year.
Correct Answer One


Multiple Choice Single Answer
Question Appointments made at senior level during the half-year is categorised under :-
Correct Answer Organisation and management


Select The Blank
Question Commission outstanding is ________ of funds.
Correct Answer Application


Multiple Choice Single Answer
Question The statement which shows the movement of cash into and out of firm's kittie is known as :-
Correct Answer Cash flow statement


Multiple Choice Single Answer
Question Cost of utilities include :-
Correct Answer Cost of electricity


Multiple Choice Single Answer
Question Marketing aspect of Detailed Project report includes :-
Correct Answer Demand forecasting


True/False
Question In both the extreme situations of trade cycles i.e. Inflation and depression, requirement of working capital may be high.
Correct Answer True

Multiple Choice Multiple Answer
Question While choosing the location for a project, the following factors should be considered :-
Correct Answer Proximity to raw materials and markets , Availability of infrastructure , Government policies and other factors


Research Methodology and Project Report - 1


Select The Blank
Question ________ is a current liability.
Correct Answer Trade credit


Multiple Choice Multiple Answer
Question Marketing category of the Project report consists of :-
Correct Answer Target market , Market potential , Pricing policy


Select The Blank
Question Under the SPACE Model, Customer loyalty is determined under the ________ dimension.
Correct Answer Company's competitive advantage


Multiple Choice Single Answer
Question Sources of funds include :-
Correct Answer Increase in secured borrowing


True/False
Question It is mandatory for each unit to obtain necessary clearance from Pollution Control Authorities before setting up any project.
Correct Answer True


Multiple Choice Single Answer
Question A project objective which states "What' is to be viewed" is termed as :-
Correct Answer Strategic perspective


Select The Blank
Question ________ tries to have what the customer will want- where, when, in what form and at what price.
Correct Answer Marketing


True/False
Question Debt Service Coverage Ratio is one of the most important ratios calculated by the bankers or financial institutions giving long term finance to the organisation.
Correct Answer True


Multiple Choice Multiple Answer
Question Management qualities includes :-
Correct Answer Honesty , Financial resources , Initiative


Multiple Choice Single Answer
Question The second phase of the technical appraisal which focuses upon appraising the likely technical gaps consists of :-
Correct Answer Problems faced during the Construction and Project implementation


True/False
Question A project is unique and no two projects are similar.
Correct Answer True


Multiple Choice Single Answer
Question Land and site development cost includes cost of :-
Correct Answer Gates


Multiple Choice Single Answer
Question A project objective which states What "achieving it " would cost is known as :-
Correct Answer Finance cost aspect


Select The Blank
Question ________ in assets involves outflow of funds.
Correct Answer Increase


Match The Following
Question- Correct Answer

Management problems- Lack of exposure
Management Quality- Initiative


Management Perception- Aspiration level/ conservative


Organisational Climate -Person oriented



Match The Following
Question- Correct Answer


Source of funds -Depreciation


Fixed assets -Building

Current assets -Debtors

Current liability- Trade credit


Multiple Choice Single Answer
Question Disposal of fixed assets is categorised under :-
Correct Answer Miscellaneous


True/False
Question The emphasis of a finance manager should be on taking a synergistic view of the project rather than looking at it only from the financial aspects.
Correct Answer True


Multiple Choice Single Answer
Question Geographic market appraisal answers to :-
Correct Answer Where do the customers live?


Multiple Choice Single Answer
Question Every project involves financial outlay which can be referred to as :-
Correct Answer Project finance


Select The Blank
Question ________ occupies a unique position in the macro economic development which helps in induction of new technology and facilitates, greater efficiency as well as higher productivity.
Correct Answer Investment


Multiple Choice Single Answer
Question The basic characteristic of a project is :-
Correct Answer That it involves current outlay of funds in expectation of future benefits


Multiple Choice Single Answer
Question Pre-operative expenses include :-
Correct Answer Interest on deferred payments


Multiple Choice Multiple Answer
Question Advantages of fund flow statement are :-
Correct Answer It determines financial consequences of the business operations , It enables the firm to plan its financial resources properly , It helps as a reliable guide for the future requirement of funds


True/False
Question Managerial problems in a project are the most pervasive.
Correct Answer True


True/False
Question In the BCG Matrix "DOGS" indicate products which are generally during the stage of Decline of a Product Life Cycle.
Correct Answer True


Multiple Choice Multiple Answer
Question The applications of cash are :-
Correct Answer Purchase of fixed assets , Payment of long term loans


True/False
Question Debt Equity ratio is a 'Solvency ratio'.
Correct Answer True


True/False
Question Current assets includes stock-in-process.
Correct Answer True


Multiple Choice Multiple Answer
Question A project objective can be said to have the following dimensions viz.:
Correct Answer Strategic perspective , Time span , Finance cost aspect


Multiple Choice Single Answer
Question Liabilities side of Balance sheet includes :-
Correct Answer Unsecured loans


Multiple Choice Single Answer
Question The rate of discount which would equate the present value of investments to the present value of benefits over the life of the project is known as :-
Correct Answer Internal rate of return


Select The Blank
Question A Project has a ________ represented by growth, maturity and decay.
Correct Answer Life cycle


Multiple Choice Multiple Answer
Question After the SPACE chart is constructed, we would normally get any one of the following basic strategic postures :-
Correct Answer Aggressive Posture , Competitive Posture , Defensive Posture


Select The Blank
Question ________ is the summary of cash book or Receipts and Payments statement.
Correct Answer Cash flow statement


Multiple Choice Single Answer
Question The point at which the unit neither earns profit nor incurs loss is known as :-
Correct Answer Break Even Point


Multiple Choice Multiple Answer
Question In the Detailed Project Report, Marketing aspects includes :-
Correct Answer Demand forecasting , Promotion , Distribution


Multiple Choice Multiple Answer
Question The various aspects which need to be considered while assessing Project finance financing are
Correct Answer Environmental factors , Risk involved , Managerial compensation


Multiple Choice Multiple Answer
Question Casual methods of Demand forecasting consists of :-
Correct Answer Consumption-level method , Econometric method


Select The Blank
Question Under ________ method, the forecasts are modified in the light of observed errors.
Correct Answer Exponential smoothing


Multiple Choice Multiple Answer
Question Provision for tax can be treated as :-
Correct Answer Item of current liabilities , Added back to the profit as per profit and loss account to arrive at operating profits


Select The Blank
Question Retained earnings indicates that whatever profits are earned by the company are not distributed by it by way of ________ but are kept aside for use in future for expansion or other purpose.
Correct Answer Dividend


Multiple Choice Single Answer
Question Infrastructural projects include :-
Correct Answer Power Generation and Distribution


Multiple Choice Single Answer
Question The ratio that roughly measures the company's potential reserve of cash is termed as :-
Correct Answer Net Working capital to total assets


Select The Blank
Question Name and designation of the chief executive comes under the ________ category.
Correct Answer General


Multiple Choice Single Answer
Question Miscellaneous fixed assets includes :-
Correct Answer Cables


Multiple Choice Single Answer
Question In the Cash flow statement, the sources of funds include
Correct Answer Share Issue

Taxation - 12

Taxation - 12

Select The Blank
Question For an individual as a citizen of India who leaves India in the
relevant previous year for the purpose of employment has to be in India for
________ days or more during previous year.
Correct Answer 182

Multiple Choice Single Answer
Question The due date prescribed for filing the returns of income in Form
No. 2C is
Correct Answer 31st October of the respective Assessment year

Multiple Choice Single Answer
Question The payments for claiming the rebate u/s 88 should :-
Correct Answer Be made out of the income chargeable to tax.

Multiple Choice Single Answer
Question As per which provision and section, every person, company or any
other person shall furnish his returns of income in the prescribed form on or
before the specified due date?
Correct Answer Section 139(1)

Select The Blank
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can
claim tax rebate of ________u/s 88C of the IT Act.
Correct Answer Rs. 5,000

Multiple Choice Multiple Answer
Question Rebate is allowed on any subscription made to National Saving
Scheme by :-
Correct Answer An individual , A HUF

Multiple Choice Multiple Answer
Question For the purpose of taxability of perquisite a specified employee
means :-
Correct Answer The person who is director of a company , The employee
who has substantial interest in the company by having 20% or more of the
voting power , The employee whose income under the head salaries (including
all the taxable monetary payments of salary but excluding the value of any nonmonetary
benefits or perquisites), after allowing deductions under Section 16,
exceeds Rs. 50,000


Multiple Choice Multiple Answer
Question Following professional institutions have their incomes exempt from
tax :-
Correct Answer Town planning , Company secretary , Accounting

True/False
Question Deduction u/s 80E for repayment of loan taken for higher
education is available if the loan must have borrowed by the assessee himself
or his Father
Correct Answer False

True/False
Question The consideration for transfer of Capital Asset is received by the
transferor is not material while Capital gain chargeable to tax.
Correct Answer True

Multiple Choice Multiple Answer
Question Any loans or deposits borrowed or repaid under section 269SS of
the Act provides that the said provisions will not apply to the loans or deposits
accepted by :-
Correct Answer Banking company including cooperative bank and post
office savings bank , Government , Government company

Match The Following
Question- Correct Answer

Employee stock option plan- ESOPS

Uncommuted Pension- Indicates the periodical payment of pension

Commuted Pension- Indicates the lump sum received in lieu of the
periodical
Treatment of Perquisite -Taxed in the hands of employee as taxable salary

True/False
Question A person who is a Senior Citizen who has attained the age of 65
years is not entitled to the rebate u/s 88 of the Act.
Correct Answer False

Multiple Choice Multiple Answer
Question For Deduction u/s 54EC from Capital Gains the assessee should
invest the whole or part of the capital gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-term
capital asset

Select The Blank
Question Unabsorbed business loss can carried forward and set off in the
subsequent Assessment Years subject to the time limit of ________
Assessment years.
Correct Answer 8

Multiple Choice Single Answer
Question Mr. A whose Gross Total Income, before allowing deductions
under Chapter VI-A is Rs. 2,40,000 wants to make the investments in the
following alternative forms Rs. 50,000 in PPF and Rs. 50,000 in Infrastructure
Bonds. The amount of rebate available to him u/s 88 is :-
Correct Answer Rs. 15,000

Multiple Choice Single Answer
Question Annual value of any one palace in possession of a former ruler is :-
Correct Answer Exempt

Match The Following
Question- Correct Answer

Any subscription made to National Saving Scheme
By an individual or a HUF is eligible for rebate u/s 88 By an individual or a
HUF is eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs.
2,50,000 during the Assessment Year 2005-2006. He invested Rs. 50,000 in the
tax saving bonds of ICICI on 10th June 2004. His tax liability for the A Y
2005-2006.
RS.12,500 RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross
Total Income of Rs. 1,45,000 including the dividend from Indian companies
amounting to Rs. 10,000. She invests Rs. 50,000 in PPF during the said
Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund
Is eligible for rebate u/s 88 Is eligible for rebate u/s 88

Select The Blank
Question To claim sec 10A deduction unit must be established in ________.
Correct Answer Free Trade Zone

Select The Blank
Question Non resident individual satisfies ________ of the basic conditions.
Correct Answer None

Multiple Choice Single Answer
Question Deduction from Capital Gains under Section 54 is for Capital
Gains arising from transfer of :-
Correct Answer House Property

Select The Blank
Question Deduction for remuneration from foreign sources for professors,
teachers etc under Section 80R is limited to ________% of such remuneration
brought in India.
Correct Answer 15

Select The Blank
Question Relief under section 89 is available to an employee in respect of the
amount of salary received ________.
Correct Answer In advance or in arrears

Select The Blank
Question AOP id formed when two or more ________ come together to earn
income.
Correct Answer Persons

Multiple Choice Multiple Answer
Question Capital Gains arise on account of excess of transfer consideration
over the following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure
incurred wholly and exclusively in connection with the transfer

Multiple Choice Multiple Answer
Question Which of the following amounts credited to P & L Account but not
taxable from Income tax Purposes as Profits from Business and Profession?
Correct Answer Refund of Income tax , Capital Gains , Dividend Income

True/False
Question Rebates as per the provisions of Section 88 of the Act are not
available from the tax on long-term capital gains.
Correct Answer True

Select The Blank
Question If assessee owns more than one house properties, he can get benefit
of nil annual value for any one house property ________.
Correct Answer As per his choice

Multiple Choice Single Answer
Question What is the treatment of principal amount of loan borrowed for the
purchase or construction of a residential house?
Correct Answer Rebate u/s 88 for such amount not exceeding Rs. 20,000

Multiple Choice Multiple Answer
Question The provisions for payment of gratuity is not allowed under section
40A(7) but, under the head, profits from business and profession, the amount of
gratuity will be allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the
employees during the previous year , The provision has been made for the
payment of a sum by way of contribution to an approval gratuity , The other
than the above two situations, any provision made for the payment of gratuity is
not allowed as deduction

Multiple Choice Multiple Answer
Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be
the least of the following :-
Correct Answer 40% of the Salary , Rs. 30,000

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees
before 15th December of Previous year is :-
Correct Answer 60% of advance tax payable

Select The Blank
Question It should be noted that the tax liability of an individual having the
total income of less than Rs ________ is Nil u/s 88D.
Correct Answer 1,00,000

True/False
Question If assessee owns more than one house properties, annual value of
any one of the house property can be treated as nil, and such option can be
changed year on year basis.
Correct Answer True

True/False
Question Income from subletting is treated as income from house property.
Correct Answer False

Multiple Choice Multiple Answer
Question Following persons are deemed to be an assessee :-
Correct Answer Legal heir of deceased person , Parents of minor assessee ,
Agent of NRI

Multiple Choice Single Answer
Question Income of notified news agencies is exempt provided :-
Correct Answer They apply their income for collection & distribution of
news

Select The Blank
Question The rebate u/s 88B is available to an individual who has attained
the age of ________ or more at any time during the previous year.
Correct Answer 65

Multiple Choice Multiple Answer
Question What is the tax treatment of the Lump sum received from
unrecognized provident fund on the retirement or resignation or death of the
employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest
on employee's contribution is taxable as "Income from Other Sources" ,
Employer's Contribution to PF and interest thereon is taxable as "Income from
salaries"

salaries"
True/False
Question Any advance tax paid before 31st March is treated as advance tax
paid during the previous year.
Correct Answer True

True/False
Question A woman assessee below the age of 65 years is also entitled to
rebate u/s 88.
Correct Answer True

Multiple Choice Single Answer
Question Rent for other amenities like lift, electricity, telephone etc. is taxed
under the heading :-
Correct Answer Income from other sources

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees
before 15th June of Previous year is :-
Correct Answer Nil

Multiple Choice Multiple Answer
Question The entertainment allowance received by the Government
employees is included in their salaries and the deduction is allowed to the
extent of least of the following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment
Allowance received.

True/False
Question Loss from house property can be adjusted against the income from
any other house property.
Correct Answer True

True/False
Question Annual premium paid by the employer for the accident insurance
policy taken by the employer in the name of the employee is chargeable to tax.
Correct Answer False

Multiple Choice Single Answer
Question Annual return for TDS from Salaries is to be filed in :-
Correct Answer Form No. 24

Taxation - 11

Select The Blank
Question Monetory Limit for deduction for royalty income of authors under Section
80QQB is Rs.________.
Correct Answer 300000

Multiple Choice Single Answer
Question Income from winning from lotteries / crossword puzzles/ horse races is
taxed at flat rate of :-
Correct Answer 0.3

Multiple Choice Single Answer
Question Income earned in previous year is subjected to tax in :-
Correct Answer Assessment year

Multiple Choice Single Answer
Question Mediclaim premium u/s Section 80D should be paid by
Correct Answer Cheque

True/False
Question Any sum payable by the assessee by way of tax, duty, cess or fee is
allowed as deduction even though they are not actually paid.
Correct Answer False

True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both
tangible as well as intangible assets.
Correct Answer True

Multiple Choice Multiple Answer
Question What is the tax treatment of Statutory Provident Fund?
Correct Answer Employer's Contribution to PF is not liable for any tax payment ,
Interest credited to the employee's account is not liable for any tax payment. , The lump
sum received at the time of retirement or resignation or death is also exempt under
section 10(11) and 10(12).

Select The Blank
Question The aggregate amount of all the expenditure falling under the head
preliminary expenses incurred under section 3________, for an Indian company the
aggregate of all the expenditure can be 5% of the cost of project or 5% of capital
employed whichever is higher.
Correct Answer 5% of the cost of project or 5% of capital employed

Multiple Choice Single Answer
Question Combined total of five heads of income equals :-
Correct Answer Gross total income

Multiple Choice Single Answer
Question Previous year always ends on :-
Correct Answer 31st March

Multiple Choice Single Answer
Question Rates of income tax are prescribed by :-
Correct Answer The Finance Act

Select The Blank
Question If assessee owns more than one house properties, he can get benefit of nil
annual value for any one house property ________.
Correct Answer As per his choice

Multiple Choice Single Answer
Question Tax liability of a person is based on :-
Correct Answer Residential status

Multiple Choice Multiple Answer
Question Choose capital expenditure from the following list :-
Correct Answer Purchase of Building , Purchase of machinery

Multiple Choice Multiple Answer
Question Rebate is allowed on any subscription made to National Saving Scheme
by :-
Correct Answer An individual , A HUF

Multiple Choice Single Answer
Question In respect of leave travel concession If Mr. A has availed the exemption
only once or has not availed any exemption at all, in the block of four years i.e. 1998-
2001 then :-
Correct Answer He can carry over the exemption to the next block of four years i.e.
2002-2005 provided that he avails the exemption of LTC in the first calendar year of the
next block i.e. 2002.

True/False
Question Loss under the head Profits from Business or Profession can be adjusted
against the Income from Salaries.
Correct Answer False

Multiple Choice Single Answer
Question The amount paid by the employer to the employee on his retirement is
taxed as :-
Correct Answer Income from Salaries

Select The Blank
Question For an individual as a citizen of India who leaves India in the relevant
previous year for the purpose of employment has to be in India for ________ days or
more during previous year.
Correct Answer 182

True/False
Question Bad Debts recovered not allowed as deduction in earlier years is not
taxable in any year.
Correct Answer True

Multiple Choice Multiple Answer
Question Short Term Capital Loss can be adjusted against :-
Correct Answer Short Term Capital Gains. , Long term Capital Gains

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees before
15th March of Previous year is :-
Correct Answer 100% of advance tax payable

Multiple Choice Multiple Answer
Question An assessee can claim deduction under section 35 in relation to the
expenditure incurred on scientific research in the field of natural gas or applied sciences
if :-
Correct Answer Any revenue expenses incurred by the assessee for carrying out the
scientific research provided that such research is related to his business , Any capital
expenses incurred by the assesse himself for carrying out the scientific research provided
that such research is related to his business , The assesse is a company engaged in the
business of bio-technology or any other notified product a weighted deduction of 150% is
allowed in respect of in-house research and development expensed, till 31st March, 2005

Select The Blank
Question Registration charges in connection with the increasing of ________ share
capital of the company is not allowed as revenue expenditure.
Correct Answer Authorized

True/False
Question If a person is required to quote the PAN and he quotes or intimates a false
number then he may be liable to pay a penalty of Rs. 25000.
Correct Answer False

Multiple Choice Multiple Answer
Question What is the tax treatment of the Lump sum received from unrecognized
provident fund on the retirement or resignation or death of the employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest on
employee's contribution is taxable as "Income from Other Sources" , Employer's
Contribution to PF and interest thereon is taxable as "Income from salaries"

Select The Blank
Question If the person responsible for deducting the tax at source and paying the
same to the credit of Central Government has not been allotted the Tax Deduction
Account Number (TAN), he shall within ________ from the end of the month in which
the tax was deducted, apply for the allotment of TAN Number.
Correct Answer One month

Match The Following
Question- Correct Answer Your Answer

Deduction in case of permanent physical disability- Section 80U

Deductions for Donations Paid -Section 80G

Deduction for Rent Paid- Section 80GG
Deduction in respect of Interest on Bank Deposits -Section 80L

True/False
Question If the capital asset becomes the property of the assessee by virtue of gift or
will, the period for which the capital asset is held by the previous owner should be
excluded while deciding the holding period.
Correct Answer False

True/False
Question Amount paid by the employer in respect of any leave standing to the credit
of the employee after the date of furnishing return of income, this sum was payable in the
previous year is allowed as deduction.
Correct Answer False

Select The Blank
Question Under section 43B, Clause N0-21 provides that the details of various
payments are allowed as deductions only if they are actually paid but, where if the
assessee follows the ________, the payments can be claimed on due basis.
Correct Answer Mercantile system of accounting

True/False
Question A woman assessee below the age of 65 years is also entitled to rebate u/s
88.
Correct Answer True

Multiple Choice Multiple Answer
Question Income received by following assesses is taxable in India :-
Correct Answer Resident , Non resident , Resident but not ordinary resident

Multiple Choice Single Answer
Question Any premium paid by the assessee by Cheque as an employer to effect or
keep in force an insurance on the health of his employees is :-
Correct Answer Allowed as expenses while calculating profits from business and
profession

Select The Blank
Question Where an assessee files or submits the returns as per provisions of section
139 or in response to the notice under section 142, the assessment officer undertakes
________ as per section 143(2) and section 143(3).
Correct Answer Scrutiny Assessment

Multiple Choice Multiple Answer
Question Assessee gets deduction of interest paid on borrowed capital even if he :-
Correct Answer Takes possession later on , Acquires later on

Match The Following
Question -Correct Answer

Perquisites -Indicate benefits or amenities provided by the employer to the employee,
either free of cost or at the concessional rate
House Rent Allowance -This indicates the amount paid by the employer to the
employee to meet the expenditure for residential accommodation occupied by the
employee
Retrenchment Compensation -Compensation received by a worker at the time of
retrenchment
Traveling Allowance- Any allowance granted to meet the cost of travel on tour or on
transfer of duty.
Select The Blank
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax
rebate of ________u/s 88C of the IT Act.
Correct Answer Rs. 5,000

Multiple Choice Single Answer
Question Assessment year is the period of 12 months starting from :-
Correct Answer 1st April to 31st March

Multiple Choice Single Answer
Question If notified news agency distributes its income amongst its members then :-
Correct Answer Whole of its income will be taxable

Multiple Choice Single Answer
Question Deduction in respect of Contribution to certain pension funds u/s 80CCC
is available to :-
Correct Answer Individuals

True/False
Question Income from subletting is treated as income from house property.
Correct Answer False

Multiple Choice Multiple Answer
Question In case of Payment of Interest on Securities no tax is required to be
deducted under the following circumstances :-
Correct Answer If the debentures are issued by a widely held company and the
debentures are listed on a stock exchange and if the amount of interest does not exceed
Rs. 2,500 during the financial year. , If the interest paid is on State or Central
Government Securities, If the debentures are issued by an institution, authority, Public
Sector Company or cooperative society as the Central Government may notify.

Select The Blank
Question Expenditure incurred by an assessee on advertisement in any brochure,
tract, pamphlet or like published by a ________shall not be allowed as business
expenditure.
Correct Answer Political party

Taxation - 10

Taxation - 10

Multiple Choice Single Answer
Question Foreign allowance received by an Indian national is exempt if it is paid by
Correct Answer Government of India

Multiple Choice Multiple Answer
Question For the purpose of section 80IA, the term eligible business means :-
Correct Answer Developing, maintaining or operating any infrastructure facility
where the term infrastructure facility means a road (including a toll road, a bridge or a
rail system) or a highway project or a water supply project. , Developing, maintaining or
operating an industrial park or special economic zones notified by the Central
Government , Generation or distribution of power

True/False
Question For being resident of India, a person must be citizen of India.
Correct Answer False

Multiple Choice Single Answer
Question The due date prescribed for filing the returns of income in Form No. 2C is
Correct Answer 31st October of the respective Assessment year

Multiple Choice Single Answer
Question The amount of accumulated interest on NSCs purchased in the earlier
years is assumed to be reinvested :-
Correct Answer And qualifies for tax rebate under section 88.

True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is
not entitled to the rebate u/s 88 of the Act.
Correct Answer False

Multiple Choice Single Answer
Question The total amount of rebates under Section 88, Section 88B, Section 88C
and Section 88D of the Act. shall :-
Correct Answer Not exceed the amount of tax calculated on the total income.

True/False
Question A company is resident of India if in any previous year it is an Indian
Company even though control & management are situated outside India.
Correct Answer False

Multiple Choice Multiple Answer
Question From GTI of a company following deductions under chapter VI A are
allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside
India , 80 IA profits and gains of infrastructure companies

True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the
company carried out, the report of such audit should be enclosed to the Tax Audit Report.
Correct Answer True

Match The Following
Question- Correct Answer

Deductions of Rent, Rates, Repairs, Taxes and Insurance on Buildings are available
u/s 30 u/s 30-
Deduction of Depreciation is available u/s 32 u/s 32
General deductions are allowed as deductions while calculating profits from business and
profession u/s 37 u/s 37
Deductions of Repairs & maintenance of machinery, plant & furniture are available
u/s 31 u/s 31

Multiple Choice Single Answer
Question In case of any contribution made by an individual or a HUF to notified
units of any approved mutual fund or of Unit Trust of India in accordance with a notified
scheme (Equity Linked Savings Scheme) :-
Correct Answer The maximum allowable limit is Rs. 10,000

True/False
Question The value of benefit resulting from the payment made by the employer in
a club for any expenditure incurred by the employee shall be taken as perquisites unless
the said expenses are incurred wholly and exclusively for official purposes.
Correct Answer True
Your Answer True
Multiple Choice Single Answer
Question What is the treatment of principal amount of loan borrowed for the
purchase or construction of a residential house?
Correct Answer Rebate u/s 88 for such amount not exceeding Rs. 20,000

True/False
Question Rebates as per the provisions of Section 88 of the Act are not available
from the tax on longterm capital gains.
Correct Answer True

Multiple Choice Multiple Answer
Question Following specific incomes are taxable under the heading income from
other sources :-
Correct Answer Winning from betting , Interest on securities of local authority ,
Bonus from key man insurance policy

True/False
Question Deductions available as per the provisions of Chapter VI of the Act are not
available for the long-term capital gains.
Correct Answer True

True/False
Question Income earned & received outside India & remitted to India is taxable for
resident & ordinary resident
Correct Answer True

Multiple Choice Single Answer
Question What is the due date for filing Annual return for TDS from Salaries?
Correct Answer 30th June of Assessment Year

Multiple Choice Multiple Answer
Question The least of the following is the exemption available to an employee if he
is in receipt of house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in
Mumbai, Kolkata, Chennai and Delhi and 40% of the Salary when the accommodation is
situated at any other place. , Actual amount of HRA received by the employee. , Excess
of rent paid over 10% of the Salary.

Select The Blank
Question If the CC of the engine is more than 1..6 liters and the motor car is owned
or hired by the employer and is used partly of official and partly for personal purposes
and if running and maintenance expenses are borne by the employee then the value of
perquisite will be Rs.________ per month plus Rs.600 if car is chauffer driven car.
Correct Answer 600

Multiple Choice Single Answer
Question As a general principle, the Basic Salary or Wages, Dearness Allowance
and Bonus / Commission is :-
Correct Answer Fully taxable.

Multiple Choice Multiple Answer
Question Under the clause No-32 of the Act, in the Tax Audit Report, the Auditor is
required to give the accounting calculation in ratios of :-
Correct Answer Gross profit/turnover , Net profit/turnover , Stock in trade/turnover

Multiple Choice Single Answer
Question If taxable income is less than 7.5% of book profit, income tax is payable
@ of :-
Correct Answer 0.1

Select The Blank
Question In case of foreign companies rate of tax is ________.
Correct Answer 0.35

True/False
Question Interest is payable by the assessee for not paying the Advance tax or if the
Advance tax paid by the assessee is less than 80% of the Assessed tax after adjusting the
amount of TDS and Advance tax Paid
Correct Answer False

Multiple Choice Multiple Answer
Question For the purpose of income tax, the perquisites can be classified into :-
Correct Answer Perquisites which are taxable in case of all types of employees ,
Perquisites which are taxable only in the hands of specified employee

Multiple Choice Single Answer
Question Loss from owning and maintaining race horses can be adjusted against :-
Correct Answer Only the income arising out of the same activity

Multiple Choice Single Answer
Question Municipal taxes are payable on :-
Correct Answer Municipal valuation
True/False
Question Dividend received from domestic company to its shareholders is taxable in
the hands of the shareholder.
Correct Answer False

Select The Blank
Question Company means any ________ Company.
Correct Answer Indian

Multiple Choice Multiple Answer
Question Section 35D applies to the preliminary expenses incurred by a company,
which consists of :-
Correct Answer Expenditure in connection with the preparation of
feasibility/project report, engineering services, or conducting market survey , Legal
charges and fees for registering the company as per the provisions of company Act, 1956
, Charges in connection with drafting and printing of memorandum of association and
Articles of Association

Multiple Choice Multiple Answer
Question Perquisites which are taxable only in the hands of specified employee
include the following categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal
attendant , Gas, electricity and water provided for personal consumption

Select The Blank
Question Loss under the head Income from Capital Gains, to the extent it is long
term capital loss can be carried forward and set off in the subsequent Assessment Years
against the ________ subject to the limit of 8 Assessment years.
Correct Answer Long term Capital Gains

Multiple Choice Single Answer
Question For charging the income in the form of salaries :-
Correct Answer There needs to be an employer-employee relationship between the
payer and the payee.

True/False
Question The amount of telephone bills (including the mobile phone bills) of the
employee reimbursed by the employer is exempt from tax.
Correct Answer True

True/False
Question The amount of expenses including membership fees and annual fees
incurred by the employee on credit card and which are paid by the employer shall be
added as the perquisites unless the said expenses are incurred wholly and exclusively for
official purposes.
Correct Answer True

Multiple Choice Single Answer
Question The amount of advance tax payable by corporate assessees before 15th
September of Previous year is :-
Correct Answer 45% of advance tax payable

Multiple Choice Single Answer
Question As per which provision and section, every person, company or any other
person shall furnish his returns of income in the prescribed form on or before the
specified due date?
Correct Answer Section 139(1)

Select The Blank
Question ________ is the tax payable on the manufacturing of goods.
Correct Answer Excise duty

Multiple Choice Single Answer
Question The return of income is required to be filed by all the companies, except
those covered under section 25 of the companies Act,1956 in the :-
Correct Answer Form No. 1

Match The Following
Question -Correct Answer

Disallowable Expenditure- Litigation Expenses in connection with recovery of a debt
which is not a trading debt.
Business Includes trade, commerce, or manufacture or any adventure or concern in
the nature of trade, commerce or manufacture Includes trade
Profession -Includes vocation

Capital Expenditure -Expenditure incurred by a company with the issue of rights shares


Multiple Choice Single Answer
Question The sum total of all the heads of income clubbed together gives the
amount of :-
Correct Answer Gross Total Income

Select The Blank
Question Short term Capital Gains is taxed at ________.
Correct Answer Normal Tax rates

Multiple Choice Multiple Answer
Question From annual value, following deductions are allowed :-
Correct Answer Standard deduction , Interest on borrowed capital , Municipal taxes

Multiple Choice Multiple Answer
Question The rebate u/s 88 is available to an :-
Correct Answer Individual , Hindu Undivided Family.


Select The Blank
Question For an individual as a citizen of India who leaves India in the relevant
previous year for the purpose of employment has to be in India for ________ days or
more during previous year.
Correct Answer 182

Multiple Choice Single Answer
Question The due date prescribed for filing the returns of income in Form No. 2C is
Correct Answer 31st October of the respective Assessment year

Multiple Choice Single Answer
Question The payments for claiming the rebate u/s 88 should :-
Correct Answer Be made out of the income chargeable to tax.

Multiple Choice Single Answer
Question As per which provision and section, every person, company or any other
person shall furnish his returns of income in the prescribed form on or before the
specified due date?
Correct Answer Section 139(1)

Select The Blank
Question Mrs. X of 45 years has received salary of Rs 5,50,000 she can claim tax
rebate of ________u/s 88C of the IT Act.
Correct Answer Rs. 5,000

Multiple Choice Multiple Answer
Question Rebate is allowed on any subscription made to National Saving Scheme by :-
Correct Answer An individual , A HUF

Multiple Choice Multiple Answer
Question For the purpose of taxability of perquisite a specified employee means :-
Correct Answer The person who is director of a company , The employee who has
substantial interest in the company by having 20% or more of the voting power , The
employee whose income under the head salaries (including all the taxable monetary
payments of salary but excluding the value of any non-monetary benefits or perquisites),
after allowing deductions under Section 16, exceeds Rs. 50,000

Multiple Choice Multiple Answer
Question Following professional institutions have their incomes exempt from tax :-
Correct Answer Town planning , Company secretary , Accounting

True/False
Question Deduction u/s 80E for repayment of loan taken for higher education is
available if the loan must have borrowed by the assessee himself or his Father
Correct Answer False

True/False
Question The consideration for transfer of Capital Asset is received by the transferor is
not material while Capital gain chargeable to tax.
Correct Answer True

Multiple Choice Multiple Answer
Question Any loans or deposits borrowed or repaid under section 269SS of the Act
provides that the said provisions will not apply to the loans or deposits accepted by :-
Correct Answer Banking company including cooperative bank and post office savings
bank , Government , Government company

Match The Following
Question- Correct Answer
Employee stock option plan- ESOPS

Uncommuted Pension- Indicates the periodical payment of pension
Commuted Pension -Indicates the lump sum received in lieu of the periodical

Treatment of Perquisite- Taxed in the hands of employee as taxable salary
True/False
Question A person who is a Senior Citizen who has attained the age of 65 years is not
entitled to the rebate u/s 88 of the Act.
Correct Answer False

Multiple Choice Multiple Answer
Question For Deduction u/s 54EC from Capital Gains the assessee should invest the
whole or part of the capital gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-term capital
asset

Select The Blank
Question Unabsorbed business loss can carried forward and set off in the subsequent
Assessment Years subject to the time limit of ________ Assessment years.
Correct Answer 8

Multiple Choice Single Answer
Question Mr. A whose Gross Total Income, before allowing deductions under Chapter
VI-A is Rs. 2,40,000 wants to make the investments in the following alternative forms
Rs. 50,000 in PPF and Rs. 50,000 in Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-
Correct Answer Rs. 15,000

Multiple Choice Single Answer
Question Annual value of any one palace in possession of a former ruler is :-
Correct Answer Exempt

Match The Following
Question -Correct Answer

Any subscription made to- National Saving Scheme
By an individual or a HUF is eligible for rebate u/s 88 By an individual or a HUF is
eligible for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000 during
the Assessment Year 2005-2006. He invested Rs. 50,000 in the tax saving bonds of ICICI
on 10th June 2004. His tax liability for the A Y 2005-2006.
RS.12,500 RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross Total
Income of Rs. 1,45,000 including the dividend from Indian companies amounting to Rs.
10,000. She invests Rs. 50,000 in PPF during the said Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund
Is eligible for rebate u/s 88 Is eligible for rebate u/s 88

Select The Blank
Question To claim sec 10A deduction unit must be established in ________.
Correct Answer Free Trade Zone

Select The Blank
Question Non resident individual satisfies ________ of the basic conditions.
Correct Answer None

Multiple Choice Single Answer
Question Deduction from Capital Gains under Section 54 is for Capital Gains arising
from transfer of :-
Correct Answer House Property

Select The Blank
Question Deduction for remuneration from foreign sources for professors, teachers etc
under Section 80R is limited to ________% of such remuneration brought in India.
Correct Answer 15

Select The Blank
Question Relief under section 89 is available to an employee in respect of the amount
of salary received ________.
Correct Answer In advance or in arrears

Select The Blank
Question AOP id formed when two or more ________ come together to earn income.
Correct Answer Persons

Multiple Choice Multiple Answer
Question Capital Gains arise on account of excess of transfer consideration over the
following amounts
Correct Answer Cost of acquisition , Cost of improvement , Expenditure incurred
wholly and exclusively in connection with the transfer

Multiple Choice Multiple Answer
Question Which of the following amounts credited to P & L Account but not taxable
from Income tax Purposes as Profits from Business and Profession?
Correct Answer Refund of Income tax , Capital Gains , Dividend Income

True/False
Question Rebates as per the provisions of Section 88 of the Act are not available from
the tax on long-term capital gains.
Correct Answer True

Select The Blank
Question If assessee owns more than one house properties, he can get benefit of nil
annual value for any one house property ________.
Correct Answer As per his choice

Multiple Choice Single Answer
Question What is the treatment of principal amount of loan borrowed for the purchase
or construction of a residential house?
Correct Answer Rebate u/s 88 for such amount not exceeding Rs. 20,000

Multiple Choice Multiple Answer
Question The provisions for payment of gratuity is not allowed under section 40A(7)
but, under the head, profits from business and profession, the amount of gratuity will be
allowed as deduction only when :-
Correct Answer The amount of gratuity has actually become payable to the employees
during the previous year , The provision has been made for the payment of a sum by way
of contribution to an approval gratuity , The other than the above two situations, any
provision made for the payment of gratuity is not allowed as deduction

Multiple Choice Multiple Answer
Question If the Salary is less than Rs. 5,00,000, Standard Deduction will be the least of
the following :-
Correct Answer 40% of the Salary , Rs. 30,000

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees before 15th
December of Previous year is :-
Correct Answer 60% of advance tax payable

Select The Blank
Question It should be noted that the tax liability of an individual having the total
income of less than Rs ________ is Nil u/s 88D.
Correct Answer 1,00,000

True/False
Question If assessee owns more than one house properties, annual value of any one of
the house property can be treated as nil, and such option can be changed year on year
basis.
Correct Answer True

True/False
Question Income from subletting is treated as income from house property.
Correct Answer False

Multiple Choice Multiple Answer
Question Following persons are deemed to be an assessee :-
Correct Answer Legal heir of deceased person , Parents of minor assessee , Agent of
NRI

Multiple Choice Single Answer
Question Income of notified news agencies is exempt provided :-
Correct Answer They apply their income for collection & distribution of news

Select The Blank
Question The rebate u/s 88B is available to an individual who has attained the age of
________ or more at any time during the previous year.
Correct Answer 65

Multiple Choice Multiple Answer
Question What is the tax treatment of the Lump sum received from unrecognized
provident fund on the retirement or resignation or death of the employee?
Correct Answer Employee's contribution to PF is exempt from tax , Interest on
employee's contribution is taxable as "Income from Other Sources" , Employer's
Contribution to PF and interest thereon is taxable as "Income from salaries"

True/False
Question Any advance tax paid before 31st March is treated as advance tax paid during
the previous year.
Correct Answer True

True/False
Question A woman assessee below the age of 65 years is also entitled to rebate u/s 88.
Correct Answer True

Multiple Choice Single Answer
Question Rent for other amenities like lift, electricity, telephone etc. is taxed under the
heading :-
Correct Answer Income from other sources

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees before 15th
June of Previous year is :-
Correct Answer Nil

Multiple Choice Multiple Answer
Question The entertainment allowance received by the Government employees is
included in their salaries and the deduction is allowed to the extent of least of the
following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment
Allowance received.

True/False
Question Loss from house property can be adjusted against the income from any other
house property.
Correct Answer True

True/False
Question Annual premium paid by the employer for the accident insurance policy
taken by the employer in the name of the employee is chargeable to tax.
Correct Answer False

Multiple Choice Single Answer
Question Annual return for TDS from Salaries is to be filed in :-
Correct Answer Form No. 24


Taxation - 9

Multiple Choice Multiple Answer
Question The entertainment allowance received by the Government employees is
included in their salaries and the deduction is allowed to the extent of least of the
following amounts :-
Correct Answer Actual amount of Entertainment Allowance received. , Rs. 5,000 ,
1/5th of Salary

True/False
Question Income Tax Act, 1961 recognizes Written Down Value (WDV) method as
well as straight line method for the computation of depreciation u/s 32 this act.
Correct Answer False

Multiple Choice Multiple Answer
Question Profits earned by an Industrial Undertaking engaged in other than
infrastructure development is available under Section 80IB for :-
Correct Answer Operation of Ship , Hotels situated in hilly area, rural area or place
of pilgrimage , Company engaged in scientific and industrial research

Multiple Choice Single Answer
Question Which of the following expenditure is in the nature of revenue
expenditure?
Correct Answer Expenditure incurred as discount on issue of debentures

Select The Blank
Question If sum received is net of TDS then it is ________ to include in income
from other sources.
Correct Answer Grossed up

True/False
Question Interest paid on the loan for acquiring a capital asset will be considered to
be a part of cost of acquisition.
Correct Answer True

Multiple Choice Single Answer
Question Mr. A whose Gross Total Income, before allowing deductions under
Chapter VI-A is Rs. 1,45,000, wants to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in Infrastructure Bonds. The amount of rebate
available to him u/s 88 is :-
Correct Answer Rs. 18,000

Multiple Choice Single Answer
Question Interest on specified securities or premium on redemption is exempt for :-
Correct Answer Non resident Indian

True/False
Question As per section 2(11) of the Income Tax Act, Block of Assets includes both
tangible as well as intangible assets.
Correct Answer True

Multiple Choice Multiple Answer
Question Deductions in respect of Certain Incomes received under Section 80L is
available in respect of
Correct Answer Interest on Central or State Government Securities , Interest on
National Saving Certificates (NSCs) Interest on National Saving Scheme, 1992 (NSS) ,
Bank Interest

Multiple Choice Single Answer
Question Tax liability of a person is based on :-
Correct Answer Residential status

Multiple Choice Multiple Answer
Question For the purpose of income tax, the perquisites can be classified into :-
Correct Answer Perquisites which are taxable in case of all types of employees ,
Perquisites which are taxable only in the hands of specified employee

Select The Blank
Question For an individual as a citizen of India who leaves India in the relevant
previous year for the purpose of employment has to be in India for ________ days or
more during previous year.
Correct Answer 182
Multiple Choice Single Answer
Question Income earned in previous year is subjected to tax in :-
Correct Answer Assessment year

Multiple Choice Multiple Answer
Question Following professional institutions have their incomes exempt from tax :-
Correct Answer Town planning , Company secretary , Accounting

Select The Blank
Question ________ of the Tax Audit Report refers to the details of various
payments which are allowed as deduction only if they are actually paid for.
Correct Answer Section 43B Clause No-21

Multiple Choice Multiple Answer
Question Short Term Capital Loss can be adjusted against :-
Correct Answer Short Term Capital Gains. , Long term Capital Gains

Select The Blank
Question To claim sec 10A deduction unit must be established in ________.
Correct Answer Free Trade Zone

Multiple Choice Single Answer
Question Assessment year is the period of 12 months starting from :-
Correct Answer 1st April to 31st March

Multiple Choice Single Answer
Question Combined total of five heads of income equals :-
Correct Answer Gross total income

Multiple Choice Single Answer
Question If an employee does not avail of this leave travel concession or assistance
during a block of four calendar years :-
Correct Answer Only one journey can be carried forward to the next block.

Select The Blank
Question To acquire PAN, a person shall apply in ________ to the assessing officer.
Correct Answer Form No. 49A

Multiple Choice Single Answer
Question Deduction from Capital Gains under Section 54F is for Capital Gains
arising from transfer of :-
Correct Answer Any Long Term Capital Asset

Select The Blank
Question Where an assessee files or submits the returns as per provisions of section
139 or in response to the notice under section 142, the assessment officer undertakes
________ as per section 143(2) and section 143(3).
Correct Answer Scrutiny Assessment

Multiple Choice Multiple Answer
Question Income of a professional association is exempt if its objectives are :-
Correct Answer Supervision , Control , Encouragement

True/False
Question While computing the profits from Business and profession, the business or
profession must be carried out during the previous year.
Correct Answer True

Multiple Choice Single Answer
Question In respect of leave travel concession If Mr. A has availed the exemption
only once or has not availed any exemption at all, in the block of four years i.e. 1998-
2001 then :-
Correct Answer He can carry over the exemption to the next block of four years i.e.
2002-2005 provided that he avails the exemption of LTC in the first calendar year of the
next block i.e. 2002.

Multiple Choice Multiple Answer
Question The amount accumulated to the credit of the employee's provident fund
account is paid at the time of :-
Correct Answer Retirement , Resignation

Multiple Choice Multiple Answer
Question From annual value, following deductions are allowed :-
Correct Answer Standard deduction , Interest on borrowed capital , Municipal taxes

Multiple Choice Single Answer
Question As a general principle, the Basic Salary or Wages, Dearness Allowance
and Bonus / Commission is :-
Correct Answer Fully taxable.

Multiple Choice Multiple Answer
Question From GTI of a company following deductions under chapter VI A are
allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from projects outside
India , 80 IA profits and gains of infrastructure companies

Multiple Choice Single Answer
Question Annual value of any one palace in possession of a former ruler is :-
Correct Answer Exempt

Select The Blank
Question If the Salary is more than Rs. 5,00,000, Standard Deduction will be
Rs.________.
Correct Answer 20000

Multiple Choice Single Answer
Question The amount of accumulated interest on NSCs purchased in the earlier
years is assumed to be reinvested :-
Correct Answer And qualifies for tax rebate under section 88.

Select The Blank
Question Deduction u/s ________B is available for 10 consequent assessment years
from the year of commencement of production.
Correct Answer 10

True/False
Question Income from subletting is treated as income from house property.
Correct Answer False

Select The Blank
Question Section 80U allows the deduction in respect of the ________ .
Correct Answer Permanent physical disability

Match The Following
Question- Correct Answer
Disallowable Expenditure -Litigation Expenses in connection with recovery of a debt
which is not a trading debt
Business Includes trade, commerce, or manufacture or any adventure or concern in
the nature of trade, commerce or manufacture Includes trade, commerce, or
manufacture or any adventure or concern in the nature of trade, commerce or
manufacture

Profession- Includes vocation

Capital Expenditure -Expenditure incurred by a company with the issue of rights shares

True/False
Question Any recreational facility provided by the employer to a group of
employees (not being restricted to a select few employees) is not exempt from tax.
Correct Answer False

True/False
Question In case of deductions for medical treatment under Section 80DDB the
amount of deduction will be reduced by the amount received under an insurance policy or
the amount reimbursed by the employer.
Correct Answer True

True/False
Question Any advance tax paid before 31st March is treated as advance tax paid
during the previous year.
Correct Answer True

Multiple Choice Single Answer
Question Municipal taxes paid is allowed as deduction from :-
Correct Answer Gross annual value

True/False
Question Entertainment Allowance received by the employees from the private
sector is taxable in the hands of the employee.
Correct Answer True

Match The Following
Question -Correct Answer

Any subscription made to National Saving Scheme -By an individual or a HUF is eligible
for rebate u/s 88
Mr. A, a 70 years old Senior Citizen, has the Gross Total Income of Rs. 2,50,000 during
the Assessment Year 2005-2006. He invested Rs. 50,000 in the tax saving bonds of ICICI
on 10th June 2004. His tax liability for the A Y 2005-2006. RS.12,500 RS.12,500
During the Assessment Year 2005-2006, Mrs. A, age 58 years, has the Gross Total
Income of Rs. 1,45,000 including the dividend from Indian companies amounting to Rs.
10,000. She invests Rs. 50,000 in PPF during the said Assessment Year. her tax liabilit is
Rs. 1,000 Rs. 1,000
Any contribution made to a Public Provident Fund Is eligible for rebate u/s 88 Is
eligible for rebate u/s 88

Multiple Choice Multiple Answer
Question Following incomes of local authorities are exempt :-
Correct Answer Capital gains , Other income , House property

Multiple Choice Multiple Answer
Question For Deduction u/s 54EC from Capital Gains the assessee should invest the
whole or part of the capital gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the long-term
capital asset

True/False
Question Income from partnership firms is exempt from taxation for the partners
Correct Answer True

Taxation - 8

Taxation - 8

Multiple Choice Single Answer
Question As a general principle, the Basic Salary or Wages, Dearness
Allowance and Bonus / Commission is :-
Correct Answer Fully taxable.

Select The Blank
Question If assessee owns more than one house properties, he can get benefit
of nil annual value for any one house property ________.
Correct Answer As per his choice

True/False
Question Any recreational facility provided by the employer to a group of
employees (not being restricted to a select few employees) is not
exempt from tax.
Correct Answer False

Multiple Choice Multiple Answer
Question What are the types of Provident Fund?
Correct Answer Statutory Provident Fund , Recognized Provident Fund ,
Unrecognized Provident Fund

Multiple Choice Multiple Answer
Question The least of the following is the exemption available to an employee if
he is in receipt of house rent allowance :-
Correct Answer 50% of the Salary where such accommodation is situated in Mumbai,
Kolkata, Chennai and Delhi and 40% of the Salary when the
accommodation is situated at any other place. , Actual amount of
HRA received by the employee. , Excess of rent paid over 10% of the
Salary.

Multiple Choice Multiple Answer
Question To get deduction of Rs 150000/- as interest on borrowed capital
assessee needs to satisfy conditions i.e. :-
Correct Answer Borrowal is after 1st April 1999 , Construction is completed in 3 years

Multiple Choice Multiple Answer
Question The entertainment allowance received by the Government employees
is included in their salaries and the deduction is allowed to the extent
of least of the following amounts :-
Correct Answer Rs. 5,000 , 1/5th of Salary , Actual amount of Entertainment
Allowance received.

Select The Blank
Question Section 35AC of the Act applies to any sum paid by the assessee to
a public sector company or a local authority or an association
approved by the national committee for ________ for carrying out
any project in upliftment of public.
Correct Answer Promotion of social and economic welfare

Multiple Choice Single Answer
Question The provisions under section 44AB of the Act, is applicable to the
person carrying on the profession and whose gross receipts in
profession :-
Correct Answer Exceeds Rs.10 lakhs in any previous year

Multiple Choice Multiple Answer
Question As per the provision of section 143(2) and 143(3) scrutiny
assessment made by assessing officer in order to ensure that :-
Correct Answer Assessee has not understated the income , Assessee has not
overstated the loss , Assessee has under paid the taxes

Multiple Choice Single Answer
Question Annual value of any one palace in possession of a former ruler is :-
Correct Answer Exempt

True/False
Question Interest paid on the loan for acquiring a capital asset will not be
considered to be a part of cost of acquisition.
Correct Answer False

Multiple Choice Single Answer
Question Previous year always ends on :-
Correct Answer 31st March

Multiple Choice Multiple Answer
Question Perquisites which are taxable only in the hands of specified employee
include the following categories of perquisites :-
Correct Answer Motor Car , Services of sweeper, gardener, watchman or personal
attendant , Gas, electricity and water provided for personal
consumption

Select The Blank
Question Short term Capital Gains is taxed at ________.
Correct Answer Normal Tax rates

Multiple Choice Single Answer
Question Income of notified news agencies is exempt provided :-
Correct Answer They apply their income for collection & distribution of news

True/False
Question Clause N0-30 of the Tax Audit requires that, if the cost Audit of the
company carried out, the report of such audit should be enclosed to
the Tax Audit Report.
Correct Answer True

True/False
Question If an assessee gets the salary from more than one employer during
an Assessment Year, Salary received from all the employers will be
aggregated and then the Standard Deduction will be allowed.
Correct Answer True

Multiple Choice Multiple Answer
Question The amount accumulated to the credit of the employee's provident
fund account is paid at the time of :-
Correct Answer Retirement , Resignation

Multiple Choice Single Answer
Question The amount of advance tax payable by non corporate assessees
before 15th September of Previous year is :-
Correct Answer 30% of advance tax payable

Multiple Choice Multiple Answer
Question Any loans or deposits borrowed or repaid under section 269SS of the
Act provides that the said provisions will not apply to the loans or
deposits accepted by :-
Correct Answer Government , Government company , Banking company including
cooperative bank and post office savings bank

Multiple Choice Single Answer
Question The amount of advance tax payable by corporate assessees before
15th March of Previous year is :-
Correct Answer 100% of advance tax payable

Multiple Choice Single Answer
Question The due date prescribed for filing the returns of income in Form No.
2C is
Correct Answer 31st October of the respective Assessment year

True/False
Question The amount of expenses including membership fees and annual fees
incurred by the employee on credit card and which are paid by the
employer shall be added as the perquisites unless the said expenses
are incurred wholly and exclusively for official purposes.
Correct Answer True

Multiple Choice Multiple Answer
Question Which of the following expenses should be debited to P & L Account,
but disallowed for Income tax purpose?
Correct Answer Wealth Tax , Personal expenditure , Income Tax

Multiple Choice Single Answer
Question The provisions regarding set off and carry forward of loses are
contained in :-
Correct Answer Sections 70 to 80 of the Income Tax Act, 1961.

Multiple Choice Single Answer
Question A partnership firm is an agreement between not more than :-
Correct Answer 20 persons

Multiple Choice Single Answer
Question Deduction from Capital Gains under Section 54B is for Capital Gains
arising from transfer of :-
Correct Answer Agricultural Land

Select The Blank
Question To acquire PAN, a person shall apply in ________ to the assessing
officer.
Correct Answer Form No. 49A

Multiple Choice Multiple Answer
Question Any amount deposited by an Individual or a HUF in 10 year or 15
year account under the Post Office Saving Bank (CTD) Rules, 1959.
The account can be in the name of :-
Correct Answer The individual himself , A minor of whom he is the guardian.

True/False
Question While computing the profits from Business and profession, the
business or profession must be carried out during the previous year.
Correct Answer True

Multiple Choice Multiple Answer
Question Following news agencies are specified by the Central Government as
specified news agencies :-
Correct Answer UNI , PTI

Select The Blank
Question Any expenditure incurred by the assessee for any purpose which is
________ or which is prohibited by law shall not be allowed as
business expenditure
Correct Answer Offence

True/False
Question If assessee owns more than one house properties, annual value of
any one of the house property can be treated as nil, and such option
can be changed year on year basis.
Correct Answer True

Match The Following
Question -Correct Answer

Superannuation Fund -It is an employee welfare
scheme

Statutory Provident Fund -This is set up as per the
provisions of Provident Fund Act, 1925

Recognized Provident Fund -the provisions of Employees Provident Fund
and Miscellaneous Provisions Act, 1952 apply to this fund.

Unrecognized Provident Fund- The provident fund which is not recognized by the
income tax authorities .


Select The Blank
Question If the Salary is more than Rs. 5,00,000, Standard Deduction will be
Rs.________.
Correct Answer 20000

Select The Blank
Question Mr. Ram is employed by the Central Government as accountant
whose gross salary income is Rs 6,00,000. He can claim standard
deduction of Rs ________ u/s 16(i) of the IT Act.
Correct Answer Rs 20,000

Match The Following
Question -Correct Answer

Deduction in case of permanent physical disability-Section 80U

Deductions for Donations Paid -Section 80G
Deduction for Rent Paid -Section 80GG

Deduction in respect of Interest on Bank Deposits -Section 80L

True/False
Question The consideration for transfer of Capital Asset is received by the
transferor is not material while Capital gain chargeable to tax.
Correct Answer True

True/False
Question The payments for claiming the tax rebate u/s 88 of the IT Act should
be made out of the income chargeable to tax.
Correct Answer True

Multiple Choice Single Answer
Question In case of any contribution made by an individual or a HUF to notified
units of any approved mutual fund or of Unit Trust of India in
accordance with a notified scheme (Equity Linked Savings Scheme)
Correct Answer The maximum allowable limit is Rs. 10,000

True/False
Question Dividend received from domestic company to its shareholders is
taxable in the hands of the shareholder.
Correct Answer False

Select The Blank
Question Loss from the activity of owning and maintaining the race horses can
be carried forward and set off in the subsequent Assessment Years
subject to the limit of ________ Assessment years.
Correct Answer 4

Select The Blank
Question If the property becomes the property of the assessee before
________, the Fair Market Value of the property of the capital asset
on that date will be considered to be the cost of acquisition
Correct Answer 1st April 1981

Select The Blank
Question For an individual as a citizen of India who leaves India in the relevant
previous year for the purpose of employment has to be in India for
________ days or more during previous year.
Correct Answer 182

Select The Blank
Question After deducting interest on capital & remuneration to partners, firm is
required to pay tax @ ________
Correct Answer Tax 35% + 2% SC +2% EC

Multiple Choice Multiple Answer
Question Under the clause No-32 of the Act, in the Tax Audit Report, the
Auditor is required to give the accounting calculation in ratios of :-
Correct Answer Gross profit/turnover , Net profit/turnover , Stock in trade/turnover



Taxation - 7

True/False
Question Deductions for income tax, payable by the employed person is
permissible.
Correct Answer True

Multiple Choice Single Answer
Question Proxy form should be deposited with the company :-
Correct Answer 48 hours before the meeting

Match The Following
Question- Correct Answer
Deduction for absence of duty -Section 9

Deductions for payment to insurance and post office -Section 7(2)

Amendment to pay by cheques 1976 Amendment to pay by cash Fine -Section 8
Multiple Choice Single Answer
Question To whom does the payment of wages act apply to ?
Correct Answer Persons employed in any factory

Select The Blank
Question A person who stands for directorship other than retiring director
has to give notice to the company at least ________ before the
date of general meeting.
Correct Answer 14 days

Multiple Choice Single Answer
Question Audit committee shall consist of not less than :-
Correct Answer Three directors

True/False
Question A temporary workman is not entitled to bonus though he works
for a few days in the organisation.
Correct Answer False

Multiple Choice Multiple Answer
Question Who is entitled to bonus?
Correct Answer Temporary workmen , Part time employee , Retrenched
employee

Multiple Choice Single Answer
Question A director is deemed to be interested in a contract if he holds
paid up capital of the company exceeding :-
Correct Answer 0.02

Select The Blank
Question To avoid conflicts of interest, ________ committee would
determine the remuneration packages of the executive directors.
Correct Answer Remuneration

Multiple Choice Single Answer
Question If an auditor after his appointment becomes subject to any of the
disqualifications, it is treated that the office is :-
Correct Answer Vacated

Select The Blank
Question Free selling/drawl of foreign exchange to authorized dealer(AD)
for ________.
Correct Answer Current account

Multiple Choice Single Answer
Question What is the minimum salary under which the persons are
covered in this act?
Correct Answer Less than Rs 1600

Multiple Choice Single Answer
Question In case a company has an executive director, how much
percentage of the board of Directors should comprise of
independent directors?
Correct Answer 0.5

True/False
Question Acquiring foreign security on gift is allowed.
Correct Answer True

True/False
Question An employee employed through contractors on building
operations is entitled to bonus.
Correct Answer False

Multiple Choice Multiple Answer
Question Borrowings for Indian companies are for :-
Correct Answer In Rupees , On repatriation , Non-repatriation
Your Answer In Rupees , On repatriation

Question An apprentice is not entitled to bonus.
Correct Answer True

Multiple Choice Single Answer
Question FEMA allows free selling of foreign exchange to/from whom from
current transaction?
Correct Answer Authorised Dealer

Multiple Choice Single Answer
Question Define an employed person under section 2 of the act.
Correct Answer Includes legal representative of a deceased employed person

Select The Blank
Question A member shall have right to apply for operations and
mismanagement of the company provided application is made
bymembers not less than ________ or by the members holding
not less than one tenth of total number of shares in the share
capital of the company.
Correct Answer 100

Multiple Choice Multiple Answer
Question Who has not prescribed particular set of documentation for
current account remittances?
Correct Answer RBI , Central Govt.

Select The Blank
Question The uses and applications of the funds raised shall be disclosed
to the audit committee on a ________basis.
Correct Answer Quarterly

Select The Blank
Question For Special Resolution, votes cast in favour of the resolution
should be ________ times more than votes cast against the
resolution.
Correct Answer 3

Multiple Choice Multiple Answer
Question Object Clauses are divided into :-
Correct Answer Main Object , Object incidental or ancillary to Main , Other
Objects

Objects
True/False
Question Charge includes Mortgage.
Correct Answer True

Multiple Choice Single Answer
Question When was the factories act passed?
Correct Answer In 1948

Multiple Choice Multiple Answer
Question Public limited company's directors have following conditions :-
Correct Answer Minimum number is three , Should be individuals , Have sound
mind

True/False
Question Government can authorise for supply of essential commodities at
concessional rates and pay wages in kind.
Correct Answer True

Select The Blank
Question A ________ shall not be made for the appointment of two or
more persons as directors of the company by single resolution in
any general meeting of public company, unless resolution has
been agreed by meeting without any vote being given against it.
Correct Answer Motion

Select The Blank
Question Preference shareholders have ________ to get dividend over
equity share holders.
Correct Answer Preferential right

Multiple Choice Multiple Answer
Question What is the manner of fixation of minimum wages?
Correct Answer Time work known as minimum time rate , Piece work known as
minimum piece rate , Guaranteed time rate for those employed
in piece work for the purpose of securing to such employees a
minimum rate of wages on time work basis


Multiple Choice Multiple Answer
Question Form No. 1 can be signed by :-
Correct Answer Chartered Accountant , Cost & Works Accountant , Advocate

Multiple Choice Single Answer
Question When was the minimum wages act passed ?
Correct Answer 1948

Select The Blank
Question Director has to vacate his office, if he has been ________ by a
court of any offence involving moral turpitude.
Correct Answer Convicted

Match The Following
Question -Correct Answer

Section 2(vi) -Wages
Wages act -1936
Factories act -1948

Section 3 of wages act- Every employer responsible for payment to employed persons

Multiple Choice Single Answer
Question The Board of directors of the company has power to appoint an
additional director :-
Correct Answer Up to maximum permissible limit

Select The Blank
Question The Forms 8 &13 should be filed in ________ to ragistrar of
companies.
Correct Answer Triplicate

Multiple Choice Multiple Answer
Question Retiring director shall be deemed to be reappointed unless :-
Correct Answer He has expressed his unwillingness to be re-appointed , He is
disqualified for appointment , Resolution for reappointment has
been put to vote & lost

Multiple Choice Single Answer
Question Payment of wages act came into existence :-
Correct Answer To ensure regular and timely payment of wages to employed
persons

Multiple Choice Single Answer
Question What is computed by the competent authority at concessional
rates?
Correct Answer Cost of living allowance and cash value

Multiple Choice Single Answer
Question Minimum gap required between date of dispatch of notice and
date of AGM is :-
Correct Answer 25 days

Multiple Choice Single Answer
Question In which case did the Bombay high court observe the general
purpose of the act?
Correct Answer Arvind mills ltd case
Multiple Choice Single Answer
Question Settlement of gift or lawful obligation shall be surrendered within
Correct Answer Seven days

Multiple Choice Multiple Answer
Question Board's Report shall include :-
Correct Answer Dividend recommended , Financial position of the company ,
Amounts transferred to Reserves

True/False
Question The independent director is a supplier of a service provider of
the company.
Correct Answer False

Select The Blank
Question WOS can make payment of royalty by ________ route.
Correct Answer Automatic route

LIST OF ATTEMPTED QUESTIONS AND ANSWERS
True/False
Question Deductions for income tax, payable by the employed person is
permissible.
Correct Answer True

Multiple Choice Single Answer
Question Proxy form should be deposited with the company :-
Correct Answer 48 hours before the meeting

Match The Following
Question- Correct Answer

Deduction for absence of duty -Section 9

Deductions for payment to insurance and post office -Section 7(2)
Amendment to pay by cheques 1976 Amendment to pay by cash Fine -Section 8

Multiple Choice Single Answer
Question To whom does the payment of wages act apply to ?
Correct Answer Persons employed in any factory

Select The Blank
Question A person who stands for directorship other than retiring director
has to give notice to the company at least ________ before the
date of general meeting.
Correct Answer 14 days

Multiple Choice Single Answer
Question Audit committee shall consist of not less than :-
Correct Answer Three directors

True/False
Question A temporary workman is not entitled to bonus though he works
for a few days in the organisation.
Correct Answer False

Multiple Choice Multiple Answer
Question Who is entitled to bonus?
Correct Answer Temporary workmen , Part time employee , Retrenched
employee

Multiple Choice Single Answer
Question A director is deemed to be interested in a contract if he holds
paid up capital of the company exceeding :-
Correct Answer 0.02

Select The Blank
Question To avoid conflicts of interest, ________ committee would
determine the remuneration packages of the executive directors.
Correct Answer Remuneration

Multiple Choice Single Answer
Question If an auditor after his appointment becomes subject to any of the
disqualifications, it is treated that the office is :-
Correct Answer Vacated

Select The Blank
Question Free selling/drawl of foreign exchange to authorized dealer(AD)
for ________.
Correct Answer Current account

Multiple Choice Single Answer
Question What is the minimum salary under which the persons are
covered in this act?
Correct Answer Less than Rs 1600

Multiple Choice Single Answer
Question In case a company has an executive director, how much
percentage of the board of Directors should comprise of
independent directors?
Correct Answer 0.5

True/False
Question Acquiring foreign security on gift is allowed.
Correct Answer True

True/False
Question An employee employed through contractors on building
operations is entitled to bonus.
Correct Answer False

Multiple Choice Multiple Answer
Question Borrowings for Indian companies are for :-
Correct Answer In Rupees , On repatriation , Non-repatriation

True/False
Question An apprentice is not entitled to bonus.
Correct Answer True

Multiple Choice Single Answer
Question FEMA allows free selling of foreign exchange to/from whom from
current transaction?
Correct Answer Authorised Dealer

Multiple Choice Single Answer
Question Define an employed person under section 2 of the act.
Correct Answer Includes legal representative of a deceased employed person

Select The Blank
Question A member shall have right to apply for operations and
mismanagement of the company provided application is made
bymembers not less than ________ or by the members holding
not less than one tenth of total number of shares in the share
capital of the company.
Correct Answer 100

Multiple Choice Multiple Answer
Question Who has not prescribed particular set of documentation for
current account remittances?
Correct Answer RBI , Central Govt.

Select The Blank
Question The uses and applications of the funds raised shall be disclosed
to the audit committee on a ________basis.
Correct Answer Quarterly

Select The Blank
Question For Special Resolution, votes cast in favour of the resolution
should be ________ times more than votes cast against the
resolution.
Correct Answer 3

Multiple Choice Multiple Answer
Question Object Clauses are divided into :-
Correct Answer Main Object , Object incidental or ancillary to Main , Other
Objects

Objects
True/False
Question Charge includes Mortgage.
Correct Answer True

Multiple Choice Single Answer
Question When was the factories act passed?
Correct Answer In 1948

Multiple Choice Multiple Answer
Question Public limited company's directors have following conditions :-
Correct Answer Minimum number is three , Should be individuals , Have sound
mind

True/False
Question Government can authorise for supply of essential commodities at
concessional rates and pay wages in kind.
Correct Answer True

Select The Blank
Question A ________ shall not be made for the appointment of two or
more persons as directors of the company by single resolution in
any general meeting of public company, unless resolution has
been agreed by meeting without any vote being given against it.
Correct Answer Motion

Select The Blank
Question Preference shareholders have ________ to get dividend over
equity share holders.
Correct Answer Preferential right

Multiple Choice Multiple Answer
Question What is the manner of fixation of minimum wages?
Correct Answer Time work known as minimum time rate , Piece work known as
minimum piece rate , Guaranteed time rate for those employed
in piece work for the purpose of securing to such employees a
minimum rate of wages on time work basis

Multiple Choice Multiple Answer
Question Form No. 1 can be signed by :-
Correct Answer Chartered Accountant , Cost & Works Accountant , Advocate

Multiple Choice Single Answer
Question When was the minimum wages act passed ?
Correct Answer 1948

Select The Blank
Question Director has to vacate his office, if he has been ________ by a
court of any offence involving moral turpitude.
Correct Answer Convicted

Match The Following
Question -Correct Answer

Section 2(vi) Wages

Wages act 1936
Factories act 1948

Section 3 of wages act Every employer responsible for payment to
employed persons


Multiple Choice Single Answer
Question The Board of directors of the company has power to appoint an
additional director :-
Correct Answer Up to maximum permissible limit

Select The Blank
Question The Forms 8 &13 should be filed in ________ to ragistrar of
companies.
Correct Answer Triplicate

Multiple Choice Multiple Answer
Question Retiring director shall be deemed to be reappointed unless :-
Correct Answer He has expressed his unwillingness to be re-appointed , He is
disqualified for appointment , Resolution for reappointment has
been put to vote & lost

Multiple Choice Single Answer
Question Payment of wages act came into existence :-
Correct Answer To ensure regular and timely payment of wages to employed
persons

Multiple Choice Single Answer
Question What is computed by the competent authority at concessional
rates?
Correct Answer Cost of living allowance and cash value

Multiple Choice Single Answer
Question Minimum gap required between date of dispatch of notice and
date of AGM is :-
Correct Answer 25 days

Multiple Choice Single Answer
Question In which case did the Bombay high court observe the general
purpose of the act?
Correct Answer Arvind mills ltd case

Multiple Choice Single Answer
Question Settlement of gift or lawful obligation shall be surrendered within
Correct Answer Seven days

Multiple Choice Multiple Answer
Question Board's Report shall include :-
Correct Answer Dividend recommended , Financial position of the company ,
Amounts transferred to Reserves

True/False
Question The independent director is a supplier of a service provider of
the company.
Correct Answer False

Select The Blank
Question WOS can make payment of royalty by ________ route.
Correct Answer Automatic route





Taxation - 6

Multiple Choice Multiple Answer
Question The entertainment allowance received by the
Government employees is included in their salaries
and the deduction is allowed to the extent of least of
the following amounts :-
Correct Answer Actual amount of Entertainment Allowance received. ,
Rs. 5,000 , 1/5th of Salary

True/False
Question Income Tax Act, 1961 recognizes Written Down Value
(WDV) method as well as straight line method for the
computation of depreciation u/s 32 this act.
Correct Answer False

Multiple Choice Multiple Answer
Question Profits earned by an Industrial Undertaking engaged
in other than infrastructure development is available
under Section 80IB for :-
Correct Answer Operation of Ship , Hotels situated in hilly area, rural
area or place of pilgrimage , Company engaged in
scientific and industrial research

Multiple Choice Single Answer
Question Which of the following expenditure is in the nature of
revenue expenditure?
Correct Answer Expenditure incurred as discount on issue of
debentures

Select The Blank
Question If sum received is net of TDS then it is ________ to
include in income from other sources.
Correct Answer Grossed up

True/False
Question Interest paid on the loan for acquiring a capital asset
will be considered to be a part of cost of acquisition.
Correct Answer True

Multiple Choice Single Answer
Question Mr. A whose Gross Total Income, before allowing
deductions under Chapter VI-A is Rs. 1,45,000, wants
to make the investments in the following alternative
forms Rs. 80,000 in PPF and Rs. 20,000 in
Infrastructure Bonds. The amount of rebate available
to him u/s 88 is :-
Correct Answer Rs. 18,000

Multiple Choice Single Answer
Question Interest on specified securities or premium on
redemption is exempt for :-
Correct Answer Non resident Indian

True/False
Question As per section 2(11) of the Income Tax Act, Block of
Assets includes both tangible as well as intangible
assets.
Correct Answer True

Multiple Choice Multiple Answer
Question Deductions in respect of Certain Incomes received
under Section 80L is available in respect of
Correct Answer Interest on Central or State Government Securities ,
Interest on National Saving Certificates (NSCs)
Interest on National Saving Scheme, 1992 (NSS) ,
Bank Interest

Multiple Choice Single Answer
Question Tax liability of a person is based on :-
Correct Answer Residential status

Multiple Choice Multiple Answer
Question For the purpose of income tax, the perquisites can be
classified into :-
Correct Answer Perquisites which are taxable in case of all types of
employees , Perquisites which are taxable only in the
hands of specified employee

Select The Blank
Question For an individual as a citizen of India who leaves India
in the relevant previous year for the purpose of
employment has to be in India for ________ days or
more during previous year.
Correct Answer 182
Multiple Choice Single Answer
Question Income earned in previous year is subjected to tax in
Correct Answer Assessment year

Multiple Choice Multiple Answer
Question Following professional institutions have their incomes
exempt from tax :-
Correct Answer Town planning , Company secretary , Accounting

Select The Blank
Question ________ of the Tax Audit Report refers to the details
of various payments which are allowed as deduction
only if they are actually paid for.
Correct Answer Section 43B Clause No-21

Multiple Choice Multiple Answer
Question Short Term Capital Loss can be adjusted against :-
Correct Answer Short Term Capital Gains. , Long term Capital Gains

Select The Blank
Question To claim sec 10A deduction unit must be established
in ________.
Correct Answer Free Trade Zone

Multiple Choice Single Answer
Question Assessment year is the period of 12 months starting
from :-
Correct Answer 1st April to 31st March

Multiple Choice Single Answer
Question Combined total of five heads of income equals :-
Correct Answer Gross total income

Multiple Choice Single Answer
Question If an employee does not avail of this leave travel
concession or assistance during a block of four
calendar years :-
Correct Answer Only one journey can be carried forward to the next
block.


Select The Blank
Question To acquire PAN, a person shall apply in ________ to
the assessing officer.
Correct Answer Form No. 49A

Multiple Choice Single Answer
Question Deduction from Capital Gains under Section 54F is for
Capital Gains arising from transfer of :-
Correct Answer Any Long Term Capital Asset

Select The Blank
Question Where an assessee files or submits the returns as per
provisions of section 139 or in response to the notice
under section 142, the assessment officer undertakes
________ as per section 143(2) and section 143(3).
Correct Answer Scrutiny Assessment

Multiple Choice Multiple Answer
Question Income of a professional association is exempt if its
objectives are :-
Correct Answer Supervision , Control , Encouragement

True/False
Question While computing the profits from Business and
profession, the business or profession must be carried
out during the previous year.
Correct Answer True

Multiple Choice Single Answer
Question In respect of leave travel concession If Mr. A has
availed the exemption only once or has not availed
any exemption at all, in the block of four years i.e.
1998-2001 then :-
Correct Answer He can carry over the exemption to the next block of
four years i.e. 2002-2005 provided that he avails the
exemption of LTC in the first calendar year of the next
block i.e. 2002.

Multiple Choice Multiple Answer
Question The amount accumulated to the credit of the
employee's provident fund account is paid at the time
of :-
Correct Answer Retirement , Resignation

Multiple Choice Multiple Answer
Question From annual value, following deductions are allowed :-
Correct Answer Standard deduction , Interest on borrowed capital ,
Municipal taxes

Multiple Choice Single Answer
Question As a general principle, the Basic Salary or Wages,
Dearness Allowance and Bonus / Commission is :-
Correct Answer Fully taxable.

Multiple Choice Multiple Answer
Question From GTI of a company following deductions under
chapter VI A are allowed
Correct Answer 80 G Donations , 80 HHB profits and gains from
projects outside India , 80 IA profits and gains of
infrastructure companies

Multiple Choice Single Answer
Question Annual value of any one palace in possession of a
former ruler is :-
Correct Answer Exempt

Select The Blank
Question If the Salary is more than Rs. 5,00,000, Standard
Deduction will be Rs.________.
Correct Answer 20000

Multiple Choice Single Answer
Question The amount of accumulated interest on NSCs
purchased in the earlier years is assumed to be
reinvested :-
Correct Answer And qualifies for tax rebate under section 88.

Select The Blank
Question Deduction u/s ________B is available for 10
consequent assessment years from the year of
commencement of production.
Correct Answer 10

True/False
Question Income from subletting is treated as income from
house property.
Correct Answer False

Select The Blank
Question Section 80U allows the deduction in respect of the
________ .
Correct Answer Permanent physical disability

Match The Following
Question- Correct Answer

Disallowable Expenditure-Litigation Expenses in connection with
recovery of a debt which is not a trading debt

Business Includes trade, commerce, or Includes trade, -commerce, or
manufacture or any adventure or concern in the nature of trade,


Profession -Includes vocation

Capital Expenditure- Expenditure incurred by a company with the
issue of rights shares
True/False
Question Any recreational facility provided by the employer to a
group of employees (not being restricted to a select
few employees) is not exempt from tax.
Correct Answer False

True/False
Question In case of deductions for medical treatment under
Section 80DDB the amount of deduction will be
reduced by the amount received under an insurance
policy or the amount reimbursed by the employer.
Correct Answer True

True/False
Question Any advance tax paid before 31st March is treated as
advance tax paid during the previous year.
Correct Answer True

Multiple Choice Single Answer
Question Municipal taxes paid is allowed as deduction from :-
Correct Answer Gross annual value

True/False
Question Entertainment Allowance received by the employees
from the private sector is taxable in the hands of the
employee.
Correct Answer True

Match The Following
Question -Correct Answer

Any subscription made to National Saving Scheme
-By an individual or a HUF is eligible for rebate u/s 88

Mr. A, a 70 years old
Senior Citizen, has the
Gross Total Income of
Rs. 2,50,000 during
the Assessment Year
2005-2006. He
invested Rs. 50,000 in
the tax saving bonds of
ICICI on 10th June
2004. His tax liability
for the A Y 2005-2006.
RS.12,500 RS.12,500
During the
Assessment Year
2005-2006, Mrs. A,
age 58 years, has the
Gross Total Income of
Rs. 1,45,000 including
the dividend from
Indian companies
amounting to Rs.
10,000. She invests
Rs. 50,000 in PPF
during the said
Assessment Year. her
tax liabilit is
Rs. 1,000 Rs. 1,000
Any contribution made
to a Public Provident
Fund
Is eligible for rebate
u/s 88
Is eligible for rebate u/s
88

Multiple Choice Multiple Answer
Question Following incomes of local authorities are exempt :-
Correct Answer Capital gains , Other income , House property

Multiple Choice Multiple Answer
Question For Deduction u/s 54EC from Capital Gains the
assessee should invest the whole or part of the capital
gains in the specified assets :-
Correct Answer Within six months from the date of transfer of the longterm
capital asset

True/False
Question Income from partnership firms is exempt from taxation
for the partners
Correct Answer True