MCQOPTIONS
Saved Bookmarks
MCQOPTIONS
This section includes 435 Mcqs, each offering curated multiple-choice questions to sharpen your Bachelor of Accounting and Finance (BAF) knowledge and support exam preparation. Choose a topic below to get started.
| 301. |
Supreme Courts precedent in binding on |
| A. | Courts |
| B. | Appellate Tribunals |
| C. | Income Tax Authorities |
| D. | All of the above. |
| Answer» E. | |
| 302. |
The audit that is made compulsory under statute is called ________ |
| A. | Statutory audit |
| B. | Partial audit |
| C. | Complete audit |
| D. | Continuous audit |
| Answer» B. Partial audit | |
| 303. |
Life Insurance Corporation of India holds twenty five percent of subscribed capital of XYZ Ltd. The appointment of statutory auditor in XYZ Ltd. Would be by………………….. |
| A. | ordinary resolution. |
| B. | special resolution. |
| C. | (a) or (b). |
| D. | none of the above. |
| Answer» C. (a) or (b). | |
| 304. |
For ITAT special powers of stay is available and stay will automatically Get vacated ifmatter is not decided in time of. |
| A. | 6 months |
| B. | 9 months |
| C. | 12 months |
| D. | 18 months |
| Answer» B. 9 months | |
| 305. |
The return of income can be filed with the Income-tax Department in electronic modeonly. |
| A. | True |
| B. | False |
| C. | none |
| D. | none |
| Answer» B. False | |
| 306. |
Amount of deduction in case of a person with severe disability under section 80U will be: |
| A. | Rs. 50,000 |
| B. | Rs. 75,000 |
| C. | Rs. 1,00,000 |
| D. | Rs. 1,50,000 |
| Answer» D. Rs. 1,50,000 | |
| 307. |
Which of the following is the most appropriate potential reaction of the auditor to his assessment that the risk of material misstatement due to fraud is high in relation to existence of inventory? |
| A. | Visit location on surprise basis to observe test counts |
| B. | Request inventory count at a date close to year end |
| C. | Vouch goods sent on approval very carefully |
| D. | Perform analytical procedures. |
| Answer» E. | |
| 308. |
……………………. is an artificial person registered under Indian Companies Act 1956. |
| A. | Individual |
| B. | Company |
| C. | Firm |
| D. | Local Authority |
| Answer» C. Firm | |
| 309. |
Which of the following can be corrected while processing the return of income under section 143(1)? |
| A. | any arithmetical error in the return |
| B. | any error in the return of income |
| C. | any mistake in the return of income |
| D. | any claim by the taxpayer which is against law |
| Answer» B. any error in the return of income | |
| 310. |
Rent Free Accommodation given to an employee by the employer is a____________. |
| A. | Allowance |
| B. | Perquisite |
| C. | Profit in lieu of salary |
| D. | None of the above |
| Answer» C. Profit in lieu of salary | |
| 311. |
An auditor is required to determine the ____ of his audit procedures according to the requirements of Standards of Auditing. |
| A. | Conduct |
| B. | Nature ,timing and extent |
| C. | Limitation |
| D. | Planning |
| Answer» C. Limitation | |
| 312. |
The Commissioner of Income-tax (Appeals) is the ________ appellate authority |
| A. | First |
| B. | Second |
| C. | Third |
| D. | Fourth |
| Answer» B. Second | |
| 313. |
The quality of information generated by the audited organization is directly related tothe strength of the organization’s ______ |
| A. | Internal check |
| B. | Internal control |
| C. | Internal audit |
| D. | All of the above |
| Answer» E. | |
| 314. |
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» B. First day of same financial year | |
| 315. |
Audit means _______. |
| A. | Recording business transactions |
| B. | Preparing final accounts |
| C. | Examination of books, accounts or vouchers |
| D. | Decision making |
| Answer» D. Decision making | |
| 316. |
An individual needs to pay Rs. 1,00,000 as advance tax. By 15th of December, howmuch amount must be paid by the individual: |
| A. | Rs. 30,000 |
| B. | Rs. 60,000 |
| C. | Rs. 1,00,000 |
| D. | Nil |
| Answer» C. Rs. 1,00,000 | |
| 317. |
Internal Audit is conducted by : |
| A. | Employees of an Organization. |
| B. | Customers |
| C. | Government |
| D. | Employees of other Organization. |
| Answer» B. Customers | |
| 318. |
Auditor should determine the ______ and the timing of the audit report |
| A. | Nature |
| B. | Actual |
| C. | Nature & actual |
| D. | Form |
| Answer» E. | |
| 319. |
Gross Total Income is arrived after: |
| A. | only adding Income under five heads of Income; |
| B. | adding Income under five heads of Income excluding losses; |
| C. | adding Income under five heads of Income, after applying clubbing provisions and making adjustment of set off and carry forward of losses |
| D. | adding Income under five heads of Income, after applying clubbing provisions and making adjustment of set off and carry forward of losses and after allowing deduction under section 80C to 80U |
| Answer» D. adding Income under five heads of Income, after applying clubbing provisions and making adjustment of set off and carry forward of losses and after allowing deduction under section 80C to 80U | |
| 320. |
Sole proprietary concerns are ______ to get their financial statements audited byindependent financial auditors. |
| A. | Legally required |
| B. | Not legally required |
| C. | Ethically required |
| D. | Not ethically required |
| Answer» C. Ethically required | |
| 321. |
Mr.Marshal owned network of telecom towers and infrastructure services. He let out these to major telecom operators of the country. He applied u/s. 197 for obtaining a certificate of lower deduction of tax. As per the Judgment of Indus Towers Ltd. Vs CIT (2014)(Del.) at what rate Tax shall be deducted |
| A. | 1% u/s 194C |
| B. | 10% u/s 194I |
| C. | 2% u/s 194I |
| D. | 0.5% u/s 194C |
| Answer» D. 0.5% u/s 194C | |
| 322. |
Duties of an auditor is _______. |
| A. | Statutory duties imposed by the Companies Act |
| B. | Duties imposed by legal or court decisions |
| C. | Duties arising out of professional etiquette |
| D. | All of the above |
| Answer» E. | |
| 323. |
A statutory auditor-------- also as internal auditor of the company |
| A. | Can act |
| B. | Cannot act |
| C. | Though can act but ethically should not act |
| D. | None of the above |
| Answer» C. Though can act but ethically should not act | |
| 324. |
When is evidential matter, generally, considered sufficient? |
| A. | When it constitutes entire population |
| B. | When it is enough to provide a basis for giving reasonable assurance regarding truthfulness |
| C. | When it is objective and relevant |
| D. | When auditor collects and evaluates it independently. |
| Answer» C. When it is objective and relevant | |
| 325. |
The objective of the audit planning is ________ |
| A. | To give appropriate attention to all important areas of audit |
| B. | To identify potential problems |
| C. | To coordinate work with other auditors and experts |
| D. | All of the above |
| Answer» E. | |
| 326. |
………………….is responsible to deduct tax at source. |
| A. | Assessee |
| B. | Payee |
| C. | Payer |
| D. | Agencies. |
| Answer» D. Agencies. | |
| 327. |
According to Section 2(7) of Income Tax Act "Assessee" means a person |
| A. | By whom any tax or other sum of money is payable |
| B. | By whom any proceeding under the Act has been taken |
| C. | Who is deemed to be an assessee in default under any provision of this Act |
| D. | All of the above |
| Answer» E. | |
| 328. |
………………………….% standard deduction is allowed on annual value. |
| A. | 20 |
| B. | 30 |
| C. | 40 |
| D. | 50 |
| Answer» C. 40 | |
| 329. |
--------------- audit is forward looking – |
| A. | Financial |
| B. | Cost |
| C. | Tax |
| D. | none |
| Answer» C. Tax | |
| 330. |
Voucher relates to ______. |
| A. | Cash receipt. |
| B. | Cash payment. |
| C. | Credit transactions |
| D. | All of the above. |
| Answer» E. | |
| 331. |
When a transaction has not been recorded in the books of account either wholly orpartially such errors are called _______. |
| A. | Error of commission |
| B. | Error of omission |
| C. | Compensating error |
| D. | None of the above |
| Answer» C. Compensating error | |
| 332. |
……………….. is a method of organising the accounting system of a business concern or a factory by which the duties of various clerks are arranged in such a way that the work of one person is automatically checked by another. |
| A. | Internal control |
| B. | Internal check |
| C. | Internal audit |
| D. | All of the above |
| Answer» C. Internal audit | |
| 333. |
Payment of Rs. ` 45,000 made in cash towards purchases of medicines. The amount of disallowance under section 40A(3) is - |
| A. | Rs 45,000 |
| B. | Rs 30,000 |
| C. | Nil |
| D. | Rs 20,000 |
| Answer» B. Rs 30,000 | |
| 334. |
Audit papers are the property of ______. |
| A. | Client |
| B. | Auditor |
| C. | Both the client and the auditor |
| D. | The audit committee |
| Answer» C. Both the client and the auditor | |
| 335. |
Income Tax Act was passed in the year _________. |
| A. | 1947 |
| B. | 1950 |
| C. | 1961 |
| D. | 1991 |
| Answer» D. 1991 | |
| 336. |
The salary, remuneration or compensation received by the partners is taxable underthe head _______________. |
| A. | Income from Other Sources |
| B. | Income from Business |
| C. | Salary |
| D. | None of the above |
| Answer» D. None of the above | |
| 337. |
The death-cum-retirement gratuity received by the Government Employee oremployee of local authority is _______________. |
| A. | Partially exempted |
| B. | Fully exempted |
| C. | Half taxable |
| D. | None of the above |
| Answer» C. Half taxable | |
| 338. |
XYZ LLP falls under which---------- category of person - |
| A. | Individual |
| B. | Partnership firm |
| C. | Company |
| D. | Association of person |
| Answer» C. Company | |
| 339. |
Which of the following sections deal with qualifications of the auditor ? |
| A. | Section 226 (1) and section 226(2). |
| B. | Section 224 (1) and section 224 (2). |
| C. | Section 226 (3) and section 226(4). |
| D. | Section 224(3) & Sec.224. |
| Answer» B. Section 224 (1) and section 224 (2). | |
| 340. |
The apex body of Income Tax Department. is |
| A. | Finance Ministry of Central Govt. |
| B. | Central Govt. of India. |
| C. | CBDT |
| D. | Dept. of Revenue |
| Answer» D. Dept. of Revenue | |
| 341. |
Rent Free Accommodation given to an employee by the employer is a _________ |
| A. | Allowance |
| B. | Perquisite |
| C. | Profit in lieu of salary |
| D. | None of the above |
| Answer» B. Perquisite | |
| 342. |
Who is responsible for the appointment of statutory auditor of a limited company? |
| A. | Directors of the company. |
| B. | Members of the company. |
| C. | The Central Government. |
| D. | All of the above. |
| Answer» C. The Central Government. | |
| 343. |
Income Tax is levied on the ___________ of a person. |
| A. | Total Income |
| B. | Total Income-Debt |
| C. | Gross Total Income |
| D. | Net Income-Debt Perquisites |
| Answer» B. Total Income-Debt | |
| 344. |
Audit of a bank is generally conducted through: |
| A. | Routine checking |
| B. | Couching |
| C. | Balance sheet audit |
| D. | Profit & Loss. |
| Answer» D. Profit & Loss. | |
| 345. |
E-filing of return in case of an office of the Government/company and a firm whoseaccounts are liable to be audited is: |
| A. | mandatory |
| B. | optional |
| C. | mandatory when its income exceeds Rs. `5,00,000 |
| D. | mandatory when its income exceeds Rs. 10,00,00 |
| Answer» B. optional | |
| 346. |
Because of Death of his Son Mr. Salman could not file Quarterly statement for TDS Deducted. As there is a reasonable cause for such failure which of the following will not be levied: |
| A. | Penalty |
| B. | Fees |
| C. | Both |
| D. | none |
| Answer» C. Both | |
| 347. |
Section ________ specifies the orders against which an appeal can be filed beforethe Commissioner of Income tax (Appeals). |
| A. | 246A |
| B. | 260A |
| C. | 253 |
| D. | 261 |
| Answer» B. 260A | |
| 348. |
Full form od CAAT . |
| A. | Computer Application Audit Techniques. |
| B. | Computer Audit Assisted Techniques. |
| C. | Computer Audit Application Techniques. |
| D. | Computer Assisted Audit Techniques. |
| Answer» E. | |
| 349. |
Mr. A is not a citizen of India. He wants to apply for PAN in India and he has consulted you to provide him the applicable form for application of PAN. What would be correct Form; |
| A. | Form 49A |
| B. | Form 49B |
| C. | Form 49AA |
| D. | None of above |
| Answer» D. None of above | |
| 350. |
Internal check is a part of |
| A. | Internal audit |
| B. | Internal accounting |
| C. | External audit |
| D. | Internal control |
| Answer» E. | |