Practice Tax Planning and Management mcq set 2 for your bba mba courses and you can give online quiz exam of Tax Planning and Management for assess your knowledge.
MCQ of Tax Planning and Management set 2
41. Alternate Minimum Tax shall not be applicable to a non-corporate assessee who has claimed anydeduction under:
A. Sections 80-IA to 80RRB
B. section 80P
C. Section 10AA
D. Section 35AD
Answer
B. section 80P
42. Under the Income-tax Act, 1961, interest on capital received by a partner from a partnership firmis chargeable under the head
A. Profits and gains of business or profession
B. Income from other sources
C. Capital gains
D. None of the above
Answer
A. Profits and gains of business or profession
43. The employer made a contribution of Rs 25,000 to recognized provident fund for the previousyear 2018-19. Such payment was made on 12th March, 2019. Such expenditure shall be considered as
A. Revenue expenditure
B. Capital expenditure
C. Deferred revenue expenditure
D. None of the above
Answer
A. Revenue expenditure
44. Income tax rates are fixed in ___
A. Income tax Act
B. Finance Act
C. Income tax rules
D. Finance rules
Answer
B. Finance Act
45. Section 2(9) of Income tax deals with ___
A. Person
B. Assessee
C. Previous Year
D. Assessment Year
Answer
D. Assessment Year
46. CBDT stands for ___
A. Central Bureau of Direct Taxes
B. Central Board of Direct Taxes
C. Citizen’s Board of Direct Taxes
D. Citizen’s Bureau of Direct Taxes
Answer
B. Central Board of Direct Taxes
47. Dividend from an Indian Company is ___
A. Fully Taxable
B. Partly Taxable
C. Fully Exempted
D. None of these
Answer
C. Fully Exempted
48. Previous year means the financial year immediately preceding the ___.
A. Accounting Year
B. Assessment Year
C. All of the above
D. None of the above
Answer
B. Assessment Year
49. ___ is exempted from income tax.
A. Interest from Indian company
B. Dividend from foreign company
C. Cooperative dividend
D. Dividend from Indian company
Answer
D. Dividend from Indian company
50. Profits earned from an illegal business are ___.
A. Taxable.
B. Tax free.
C. Ignored by Tax Authorities.
D. treated as other income.
Answer
A. Taxable.
51. Subletting is assessable under the head ___
A. Income from HP
B. Income from Other Source
C. Income from Capital Gain
D. None of the above
Answer
B. Income from Other Source
52. Preliminary expenses incurred are allowed deduction in:
A. 10 equal annual instalments
B. 5 equal annual instalments
C. full
D. None of these
Answer
B. 5 equal annual instalments
53. Educational cess is levied in case of ___
A. Individual
B. HUF
C. Company
D. All assesses
Answer
D. All assesses
54. As per section 2(31), the following is not included in the definition of ‘person’
A. An individual
B. A Hindu undivided family
C. A company
D. A minor
Answer
D. A minor
55. Amendments by the finance act are made applicable from
A. First day of next financial year
B. First day of same financial year
C. Last day of same Accounting year
D. None of the above
Answer
A. First day of next financial year
56. Assessee is having stock existing in the business. Valuation of stock will be at:
A. Cost price
B. Market price
C. Cost or market price, whichever is less
D. Cost or market price, whichever is more
Answer
C. Cost or market price, whichever is less
57. Which is the charging section of income under the head profits and gains of business orprofession?
A. Section 15
B. Section 24
C. Section 28
D. Section 17
Answer
C. Section 28
58. Which of the following taxes are allowed as deduction while computing the business income?
A. Wealth-tax
B. Income-tax
C. Sales tax
D. None of the above
Answer
C. Sales tax
59. As per section 30, which expenditure incurred for a building used for the business or professionshall not be allowed as deduction?
A. Rent, rates and taxes
B. Insurance of building
C. Repairs of building
D. Capital expenditure
Answer
D. Capital expenditure
60. Group of assets falling within a class of assets comprising of tangible & intangible assets isknown as :
A. Group of assets
B. Block of assets
C. Set of assets
D. Cluster of assets
Answer
B. Block of assets
61. A short term capital asset means a capital asset held by the assesse for not more than
A. 12 Months immediately preceding the month of its transfer
B. 24 Months immediately preceding the month of its transfer
C. 36 Months immediately preceding the month of its transfer
D. None of these
Answer
C. 36 Months immediately preceding the month of its transfer
62. ___ are treated as agricultural income
A. Income from poultry farm
B. Income from bee heaving
C. Purchase of standing crops
D. All of these
Answer
D. All of these
63. Long term capital loss can be set off against ___
A. Long term capital loss
B. Short term capital loss
C. Long term capital gain
D. All of these
Answer
C. Long term capital gain
64. Clubbing of income means
A. Adding income of two persons
B. Inclusion of income of other person in assessee’sincome
C. Total income of various heads
D. Collection of income
Answer
B. Inclusion of income of other person in assessee’sincome
65. Income from horse race falls under the head
A. Salary
B. Other sources
C. Profession
D. Business
Answer
B. Other sources
66. Which of the following is not taxable under the head income from other sources?
A. Family pension
B. Sum received under Keyman Insurance Policy
C. Rent received on letting of business
D. Salary to a member of parliament
Answer
C. Rent received on letting of business
67. PAN stands for
A. Private bank Number
B. Permanent Account Number
C. Personal Account Number
D. Passive Account Number
Answer
B. Permanent Account Number
68. Donation is deductible under section
A. 80 C
B. 80D
C. 80 E
D. 80 G
Answer
D. 80 G
69. Return filed after the due date is called
A. Revised return
B. Best return
C. Belated return
D. Defective return
Answer
C. Belated return
70. Tax deduction available to certain industries for the initial few years is called ___
A. Tax Holiday
B. Tax
C. TDS
D. Advance
Answer
A. Tax Holiday
71. An assessee was engaged in the business of cattle rearing. He incurred a loss in respect ofanimals which were used for the purposes of his business (otherwise than as stock-in trade) and which have died. Such expenditure shall be considered as
A. Revenue expenditure
B. Capital expenditure
C. Deferred revenue expenditure
D. Illegal expenditure
Answer
A. Revenue expenditure
72. The loss from speculation business can be set off against
A. Any income
B. Not any income
C. Non speculative business
D. Speculative business only
Answer
D. Speculative business only
73. Minor’s income is clubbed to ___
A. Father’s income
B. Mother’s income
C. Father’s income or mother’s income whichever is grater
D. Both mother’s and father’s income
Answer
C. Father’s income or mother’s income whichever is grater
74. ___ deals with PAN
A. Section 140
B. Section 140 (A)
C. Section 140 (B)
D. Section 140 (C)
Answer
B. Section 140 (A)
75. ___ is a casual income
A. Interest received
B. Dividend income
C. Person received
D. Winning from lotteries
Answer
D. Winning from lotteries
76. An assessee was engaged in the business of dealing in commodities. He had paid Commodities transaction tax of Rs.15,000 in respect of the taxable commodities transactions. Income arising of Rs 3,00,000 from such taxable commodities transactions was included in the income computed under the head “Profits and gains of business or profession”. Such expenditure of payment of Commodities transaction tax shall be considered as
A. Revenue expenditure
B. Capital expenditure
C. Speculative transaction expenditure
D. Illegal expenditure
Answer
A. Revenue expenditure
77. ___ is the implementation of the plan of tax
A. Tax evasion
B. Tax avoidance
C. Tax management
D. None of these
Answer
C. Tax management
78. Which of the following is an objective of tax management?
A. Minimize litigation
B. Productive investment
C. Compliance with legal formalities
D. Healthy growth of economy
Answer
C. Compliance with legal formalities
79. The method by which a person illegally reduces his tax burden by either deflating their income orinflating their expenses is known as
A. Tax planning
B. Tax evasion
C. Tax management
D. Tax avoidance
Answer
B. Tax evasion
80. ___ refers to hedging of tax?
A. Tax planning
B. Tax evasion
C. Tax management
D. Tax avoidance
Answer
D. Tax avoidance
