Commerce MCQs
Topic Notes: Commerce
MCQs and preparation resources for competitive exams, covering important concepts, past papers, and detailed explanations.
Plato
- Biography: Ancient Greek philosopher (427–347 BCE), student of Socrates and teacher of Aristotle, founder of the Academy in Athens.
- Important Ideas:
- Theory of Forms
- Philosopher-King
- Ideal State
131
Which section of the Income Tax Act governs the Tax Deducted at Source (TDS) requirements for payments made to contractors?
Answer:
194C
Section 194C of the Income Tax Act specifically mandates the deduction of tax at source on payments made to residents for carrying out any work in pursuance of a contract between the contractor and specified entities. This section ensures tax compliance in the construction and service sectors.
132
For the 2015-16 assessment year, what was the maximum deduction allowed under Section 80QQB for authors of literary, artistic, or scientific books?
Answer:
Rs. 3,00,000
Section 80QQB provides a deduction to resident individuals who are authors of books of a literary, artistic, or scientific nature. For the assessment year 2015-16, the maximum limit for this deduction was set at Rs. 3,00,000, intended to encourage intellectual and creative contributions by providing tax relief on royalty income.
133
What do the first three characters of a Tax Deduction and Collection Account Number (TAN) represent?
Answer:
Jurisdiction code
The TAN is a ten-character alphanumeric code. The first three characters represent the jurisdiction code, which identifies the specific city or region where the TAN was issued. This helps tax authorities categorize and track tax deductions based on geographical location.
134
Under the Income Tax Ordinance, what is the minimum threshold of advance tax payable by an assessee during the financial year that triggers the obligation to pay?
Answer:
Rs. 10,000 or more
According to standard tax provisions, advance tax is mandatory when the estimated tax liability for the year exceeds a specific threshold. In many jurisdictions, including the context of this question, this threshold is set at Rs. 10,000. If the tax liability is below this amount, the assessee is generally not required to pay advance tax installments.
135
Match the following Income Tax Act sections with their respective provisions: (a) 80DDB, (b) 80G, (c) 80L, (d) 80CCC.
Answer:
a-3, b-4, c-1, d-2
Section 80DDB relates to deductions for medical treatment, 80G covers donations to certain funds, 80L pertains to interest on certain securities, and 80CCC involves contributions to specific pension funds. Matching these correctly yields the sequence a-3, b-4, c-1, d-2, which aligns with the standard provisions of the Income Tax Act.
136
Which section of the Income Tax Act specifies the provisions for Tax Deducted at Source (TDS) on salaries?
Answer:
Section 192
Section 192 of the Income Tax Act mandates that any person responsible for paying income chargeable under the head 'Salaries' shall, at the time of payment, deduct income tax at the average rate of income tax computed on the basis of the rates in force for the financial year.
137
Identify the correct pairing of TDS certificate forms with their respective issuance frequencies.
Answer:
1 and 2
Form 16 is issued annually to employees regarding salary income, while Form 16A is issued quarterly to non-salary deductees for TDS deducted on other payments. These forms are essential for taxpayers to claim credit for taxes deducted at source.
138
Which of the following donations qualifies for a 100% tax deduction under the Income Tax Act?
Answer:
National Sports Fund
Donations made to specific funds like the National Sports Fund are eligible for a 100% deduction from the gross total income under Section 80G. This incentive is provided by the government to promote sports development and encourage private contributions toward national-level initiatives that benefit the public interest.
139
What is the maximum allowable deduction under Section 80CCF?
Answer:
Rs. 20,000
Section 80CCF was introduced to encourage investment in long-term infrastructure bonds. The deduction allowed under this section is capped at a specific limit, which was set at Rs. 20,000. This deduction is available to individuals and Hindu Undivided Families (HUFs) for investments made in notified long-term infrastructure bonds during the relevant financial year.
140
What is the statutory deadline for the payment of the first installment of advance tax in India?
Answer:
15thJune
Under the Income Tax Act, taxpayers liable to pay advance tax must do so in installments. The first installment, amounting to 15% of the total advance tax liability, is due on or before the 15th of June of the relevant financial year. This ensures a steady flow of tax revenue to the government throughout the fiscal period.