Income Tax Law And Practice Set -6

income tax law and practice mcq
Quiz 1 2 3 4 5 6 7 8

Question 1. What is the time limit for holding of a Financial Asset, to be called a Short Term Capital Asset?

(A) Not more than 36 months

(B) Not more than 12 months

(C) Not more than 6 months

(D) Not more than 6 months

View Answer
(C) Not more than 6 months

Question 2. To be a long term capital asset, a nonfinancial asset should be held more than __________.

(A) 60 months.

(B) 36 months.

(C) 24 months.

(D) 12 months.

View Answer
(B) 36 months.

Question 3. Shares held for less than 12 months are _________ .

(A) projected capital asset

(B) Exempted capital asset

(C) Long term capital asset

(D) Short term capital asset

View Answer
(D) Short term capital asset

Question 4. House property held for less than 36 months is __________.

(A) projected capital asset.

(B) Exempted capital asset.

(C) Short-term capital asset.

(D) Long-term capital asset.

View Answer
(C) Short term capital asset.

Question 5. Indexation is applicable to ____________.

(A) Sale of long term capital assets which are not depreciable assets

(B) Sale of depreciable capital assets.

(C) Sale of long term debentures.

(D) Sale of short-term capital assets.

View Answer
(A) Sale of long term capital assets which are not depreciable assets

Question 6. Cost of long term debentures are _________.

(A) Eligible for indexing

(B) None of these.

(C) Not eligible for indexing.

(D) All the above.

View Answer
(C) Not eligible for indexing

Question 7. What is the date on which the Fair Market Value of capital assets acquired is determined?

(A) 1.4.1971

(B) 1.4.1981

(C) 1.4.1971

(D) 1.4.2001

View Answer
(B) 1.4.1981

Question 8. FMV on 1.4.81 is applicable to assets __________.

(A) Acquired prior to 1.4.81.

(B) Acquired after 1.4.81.

(C) Transferred prior to 1.4.81.

(D) None of the above.

View Answer
(A) Acquired prior to 1.4.81

Question 9. Cost of improvement incurred prior to 1.4.81 is ___________.

(A) Indexed separately.

(B) Ignored fully.

(C) Indexed along with cost of acquisition.

(D) None of these.

View Answer
(B) Ignored fully.

Question 10. Cost inflation rules for the purpose of long term capital gain has been notified by central government every year starting from the financial year _________.

(A) 1975-76.

(B) 1981-82.

(C) 1985-86.

(D) 1991-92.

View Answer
(B) 1981-82. 

Question 11. Short term capital gain on sale of unlisted shares are __________.

(A) Partially Taxable.

(B) Partially Exempted.

(C) Exempted.

(D) Taxable.

View Answer
(D) Taxable.

Question 12. Long term capital gain on sale of unlisted shares are ________. 

(A) Partially Taxable.

(B) Partially Exempted.

(C) Exempted.

(D) Taxable.

View Answer
(D) Taxable.

Question 13. Exemption u/s 54 is allowed when a residential house is sold and the investment is made in __________.

(A) Jewellery.

(B) Shares.

(C) Land.

(D) Another residential house.

View Answer
(D) Another residential house

Question 14. Which one of the following is not an admissible expense ________.

(A) Sales tax

(B) Bad debt

(C) Excise duty

(D) Income tax

View Answer
(D) Income tax

Question 15. Tax on short-term gain on sale of listed shares is ____________.

(A) 15%.

(B) 30%.

(C) 25%.

(D) 20%.

View Answer
(A) 15%.

Question 16. Tax on long term capital gain is __________.

(A) 25%.

(B) 30%.

(C) 20%.

(D) 10%.

View Answer
(C) 20%.

Question 17. Income from other sources is a __________.

(A) Constant and regular income.

(B) Income from a single source.

(C) Major head of income.

(D) Residuary head of income.

View Answer
(D) Residuary head of income

Question 18. Which one of the following is not an income from other sources?

(A) Profit on sale of building.

(B) Gift in excess of Rs.50,000 from an unrelated person.

(C) Winnings from cross word puzzles.

(D) Interest on fixed deposit in bank.

View Answer
(A) Profit on sale of building

Question 19. Which of the following income from other sources is not taxable?

(A) Winnings from lottery.

(B) Dividend from domestic company.

(C) Dividend from foreign company.

(D) Dividend from co-operative society.

View Answer
(B) Dividend from domestic company.

Question 20. Dividends from co-operative society are __________.

(A)  Partially Taxable.

(B) Partially Exempted.

(C) Taxable.

(D) Exempted.

View Answer
(C) Taxable. 

Question 21. Grossing up of interest on securities is required when _________.

(A)  Interest is received after T.D.S.

(B) The interest on bank deposit is less than Rs. 10,000.

(C) They are central govt. securities.

(D) None of these.

View Answer
(A)  Interest is received after T.D.S.

Question 22. Tax is reduced from casual incomes at ________.

(A) 10% + surcharge and cesses.

(B) 30%.

(C) 20% + surcharge and cesses.

(D) none of these.

View Answer
(B) 30%.

Question 23. Interest on Bank Term Deposits is subject to tax deduction at source if the interest amount during the relevant previous year exceeds ___________.

(A) Rs: 30,000.

(B) Rs: 10,000.

(C) Rs: 5,000.

(D) Rs: 2,000.

View Answer
(B) Rs: 10,000.

Question 24. Rate of T.D.S for unlisted securities, including cesses is ________.

(A) 30.6%.

(B) 10%.

(C) 15.6%.

(D) 10.6%.

View Answer
(B) 10%.

Question 25. Speculation Loss can be carried forward for _________.

(A) 4years

(B) 5years

(C) 10years

(D) 8 years

View Answer
(A) 4years
Quiz 1 2 3 4 5 6 7 8