Commerce & Accountancy

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Commerce & Accountancy

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Commerce & Accountancy MCQ & Objective Questions

Commerce & Accountancy is a vital subject for students aiming to excel in their school exams and competitive assessments. Mastering this field not only enhances your understanding of financial principles but also significantly boosts your exam scores. Practicing MCQs and objective questions is essential, as it helps you identify important questions and reinforces your exam preparation through targeted practice questions.

What You Will Practise Here

Fundamental concepts of accounting and financial statements
Key principles of commerce including trade, marketing, and economics
Important formulas related to profit and loss, balance sheets, and cash flow
Definitions of key terms such as assets, liabilities, and equity
Diagrams illustrating accounting processes and business models
Theory areas covering the role of commerce in the economy
Analysis of case studies relevant to real-world commerce scenarios

Exam Relevance

Commerce & Accountancy is a significant part of the curriculum for CBSE, State Boards, and various competitive exams like NEET and JEE. Questions often focus on practical applications of concepts, requiring students to solve numerical problems and interpret financial data. Common question patterns include multiple-choice questions that test both theoretical knowledge and practical understanding, making it crucial to be well-prepared.

Common Mistakes Students Make

Misunderstanding the difference between assets and liabilities
Confusing terms related to accounting principles
Overlooking the importance of accurate calculations in numerical questions
Neglecting to review the impact of transactions on financial statements

FAQs

Question: What are the key topics I should focus on in Commerce & Accountancy?
Answer: Focus on financial statements, accounting principles, and key formulas to excel in this subject.

Question: How can I improve my performance in Commerce & Accountancy exams?
Answer: Regular practice of MCQs and understanding the concepts thoroughly will enhance your performance.

Start solving practice MCQs today to test your understanding and boost your confidence in Commerce & Accountancy. Remember, consistent practice is the key to success in your exams!

Business Studies Cost & Management Accounting Financial Accounting Taxation Basics

Q. What is the maximum deduction available under Section 80C for investments in specified financial instruments?

A. Rs. 1,50,000
B. Rs. 2,00,000
C. Rs. 50,000
D. Rs. 1,00,000

Solution

The maximum deduction available under Section 80C for investments in specified financial instruments is Rs. 1,50,000.

Correct Answer: A — Rs. 1,50,000

Q. What is the maximum deduction available under Section 80C for the financial year 2022-23?

A. Rs. 1,50,000
B. Rs. 2,00,000
C. Rs. 50,000
D. Rs. 1,00,000

Solution

The maximum deduction available under Section 80C is Rs. 1,50,000.

Correct Answer: A — Rs. 1,50,000

Q. What is the maximum deduction available under Section 80D for health insurance premium for a family including parents?

A. Rs. 25,000
B. Rs. 50,000
C. Rs. 75,000
D. Rs. 1 lakh

Solution

The maximum deduction available under Section 80D for health insurance premium for a family including parents is Rs. 50,000.

Correct Answer: B — Rs. 50,000

Q. What is the maximum deduction available under Section 80D for health insurance premiums for a family including parents?

A. 25,000
B. 50,000
C. 75,000
D. 1,00,000

Solution

The maximum deduction available under Section 80D for health insurance premiums for a family including parents is 50,000.

Correct Answer: B — 50,000

Q. What is the maximum deduction available under Section 80E for interest on education loans?

A. Rs. 50,000
B. Rs. 1,00,000
C. No limit
D. Rs. 25,000

Solution

There is no maximum limit for deduction under Section 80E for interest on education loans.

Correct Answer: C — No limit

Q. What is the maximum limit for claiming deduction under Section 80D for health insurance premium for a family including parents?

A. ₹25,000
B. ₹50,000
C. ₹75,000
D. ₹1,00,000

Solution

The maximum limit for claiming deduction under Section 80D for health insurance premium for a family including parents is ₹50,000.

Correct Answer: B — ₹50,000

Q. What is the maximum limit for claiming deduction under Section 80E for interest on education loans?

A. Rs. 50,000
B. No limit
C. Rs. 1,00,000
D. Rs. 2,00,000

Solution

There is no maximum limit for claiming deduction under Section 80E for interest on education loans.

Correct Answer: B — No limit

Q. What is the maximum limit for claiming deductions under Section 80C in a financial year?

A. ₹1,00,000
B. ₹1,50,000
C. ₹2,00,000
D. ₹50,000

Solution

The maximum limit for claiming deductions under Section 80C is ₹1,50,000.

Correct Answer: A — ₹1,00,000

Q. What is the maximum limit for claiming standard deduction for salaried individuals in the financial year 2022-23?

A. Rs. 50,000
B. Rs. 1,00,000
C. Rs. 30,000
D. Rs. 40,000

Solution

The maximum limit for claiming standard deduction for salaried individuals is Rs. 50,000.

Correct Answer: A — Rs. 50,000

Q. What is the maximum limit for deduction under Section 80D for health insurance for a family including parents?

A. ₹25,000
B. ₹50,000
C. ₹75,000
D. ₹1,00,000

Solution

The maximum limit for deduction under Section 80D for health insurance for a family including parents is ₹50,000.

Correct Answer: B — ₹50,000

Q. What is the maximum limit for deduction under Section 80D for health insurance premiums for a family?

A. Rs. 25,000
B. Rs. 50,000
C. Rs. 1,00,000
D. Rs. 15,000

Solution

The maximum limit for deduction under Section 80D for health insurance premiums for a family is Rs. 50,000.

Correct Answer: B — Rs. 50,000

Q. What is the maximum limit of deduction under Section 80C for the financial year 2022-23?

A. Rs. 1 lakh
B. Rs. 1.5 lakh
C. Rs. 2 lakh
D. Rs. 50,000

Solution

The maximum limit of deduction under Section 80C for the financial year 2022-23 is Rs. 1.5 lakh.

Correct Answer: B — Rs. 1.5 lakh

Q. What is the maximum limit of deduction under Section 80D for health insurance for a family including parents?

A. 25,000
B. 50,000
C. 75,000
D. 1,00,000

Solution

The maximum limit of deduction under Section 80D for health insurance for a family including parents is Rs. 1,00,000.

Correct Answer: D — 1,00,000

Q. What is the maximum limit of deduction under Section 80D for health insurance for a senior citizen?

A. Rs. 25,000
B. Rs. 50,000
C. Rs. 75,000
D. Rs. 1,00,000

Solution

The maximum limit of deduction under Section 80D for health insurance for a senior citizen is Rs. 50,000.

Correct Answer: B — Rs. 50,000

Q. What is the maximum limit of deduction under Section 80D for health insurance premium for senior citizens?

A. Rs. 25,000
B. Rs. 50,000
C. Rs. 75,000
D. Rs. 1,00,000

Solution

The maximum limit of deduction under Section 80D for health insurance premium for senior citizens is Rs. 50,000.

Correct Answer: B — Rs. 50,000

Q. What is the maximum limit of deduction under Section 80E for interest on education loans?

A. Rs. 50,000
B. Rs. 1,00,000
C. No limit
D. Rs. 2,00,000

Solution

There is no maximum limit for deduction under Section 80E for interest on education loans.

Correct Answer: C — No limit

Q. What is the maximum penalty for failure to furnish GST returns?

A. Rs. 5,000
B. Rs. 10,000
C. Rs. 25,000
D. Rs. 50,000

Solution

The maximum penalty for failure to furnish GST returns is Rs. 25,000.

Correct Answer: C — Rs. 25,000

Q. What is the maximum penalty for late filing of income tax returns under Section 234F?

A. Rs. 1,000
B. Rs. 5,000
C. Rs. 10,000
D. Rs. 50,000

Solution

The maximum penalty for late filing of income tax returns under Section 234F is Rs. 10,000.

Correct Answer: C — Rs. 10,000

Q. What is the normal balance of an expense account?

A. Debit
B. Credit
C. Neither
D. Both

Solution

The normal balance of an expense account is a debit, which increases the expense when recorded.

Correct Answer: A — Debit

Q. What is the penalty for late filing of income tax returns in India?

A. Rs. 1,000
B. Rs. 5,000
C. Rs. 10,000
D. No penalty

Solution

The penalty for late filing of income tax returns can be up to Rs. 10,000 depending on the delay.

Correct Answer: C — Rs. 10,000

Q. What is the penalty for late filing of income tax returns under Section 234F?

A. Rs. 1,000
B. Rs. 5,000
C. Rs. 10,000
D. No penalty

Solution

The penalty for late filing of income tax returns under Section 234F can be up to Rs. 10,000.

Correct Answer: C — Rs. 10,000

Q. What is the penalty for late filing of income tax returns?

A. Rs. 1,000
B. Rs. 5,000
C. Rs. 10,000
D. No penalty

Solution

The penalty for late filing of income tax returns can be up to Rs. 10,000.

Correct Answer: C — Rs. 10,000

Q. What is the primary accounting standard governing amalgamation?

A. IFRS 3
B. IAS 2
C. GAAP
D. IFRS 10

Solution

IFRS 3 is the primary accounting standard that deals with business combinations, including amalgamation.

Correct Answer: A — IFRS 3

Q. What is the primary accounting standard governing partnerships?

A. IFRS 10
B. IAS 1
C. AS 26
D. AS 7

Solution

AS 26 (Accounting for Intangible Assets) is relevant for partnerships, especially regarding goodwill.

Correct Answer: C — AS 26

Q. What is the primary accounting standard that governs amalgamation in corporate accounting?

A. IFRS 3
B. GAAP
C. IAS 2
D. ASC 805

Solution

IFRS 3 (International Financial Reporting Standard 3) governs business combinations, including amalgamation, and outlines how to account for such transactions.

Correct Answer: A — IFRS 3

Q. What is the primary accounting standard that governs partnership accounting?

A. IFRS
B. GAAP
C. IAS
D. FASB

Solution

GAAP (Generally Accepted Accounting Principles) is the primary accounting standard that governs partnership accounting.

Correct Answer: B — GAAP

Q. What is the primary accounting standard used in the United States?

A. IFRS
B. GAAP
C. IAS
D. FASB

Solution

GAAP (Generally Accepted Accounting Principles) is the primary accounting standard in the U.S.

Correct Answer: B — GAAP

Q. What is the primary advantage of a sole proprietorship?

A. Limited liability
B. Ease of formation
C. Access to capital
D. Shared decision-making

Solution

A sole proprietorship is easy to form as it requires minimal legal formalities.

Correct Answer: B — Ease of formation

Q. What is the primary advantage of the declining balance method of depreciation?

A. It is simple to calculate.
B. It provides tax benefits in early years.
C. It results in higher book value.
D. It is the most commonly used method.

Solution

The declining balance method allows for higher depreciation expenses in the early years, providing tax benefits.

Correct Answer: B — It provides tax benefits in early years.

Q. What is the primary advantage of using FIFO during periods of inflation?

A. Lower taxes
B. Higher cash flow
C. Higher net income
D. Lower cost of goods sold

Solution

The primary advantage of using FIFO during periods of inflation is that it results in higher net income due to lower cost of goods sold.

Correct Answer: C — Higher net income

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