8/29/2019 Unit Test-5(Defined Contributions)

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Question 1 Mr. Banotpal has deposited Rs. 90,000 in his PPF A/c so opened with SBI
Not answered during the Previous Year 2009-10, he wants to know how much of it will
Marked out of be eligible for deduction u/s 80-C as per Chapter VIA of ""The Income
1.00 Tax Act, 1961"". (Note he had not made any other investment or
payments so eligible for deduction u/s 80-C). As a Financial Planner
address his concern and provide an appropriate advise with reference to
I.T Act, 1961 for IT AY 2010-11 governing IT PY 2009-10

Select one:
a. Eligible deduction u/s 80-C will be Rs. 90,000

b. You cannot deposit Rs 90,000 in the PPF account

c. Eligible deduction u/s 80-C will be Rs. 1,10,000

d. Eligible deduction u/s 80-C will be Rs.70,000

The correct answer is: You cannot deposit Rs 90,000 in the PPF account

Question 2 The rate of return on PPF is currently ___

Not answered

Marked out of Select one:

1.00
a. 0.09

b. 0.08

c. 0.085

d. None of the above

The correct answer is: 0.08

Question 3 The interest in a PPF account is compounded _______

Not answered

Marked out of Select one:

1.00
a. Quarterly

b. Monthly

c. Annually

d. None of the above

The correct answer is: Annually

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8/29/2019 Unit Test-5(Defined Contributions)

Question 4 Under the EEE system there is ____

Not answered

Marked out of Select one:

1.00
a. Tax at the time of return of funds

b. Some tax to be paid

c. Tax on certain instruments

d. No tax to be paid

The correct answer is: No tax to be paid

Question 5 Under the EET system there is _____

Not answered

Marked out of Select one:

1.00
a. Tax at the time of return of funds

b. Some tax to be paid

c. No tax to be paid

d. Tax on certain instruments

The correct answer is: Tax at the time of return of funds

Question 6 _________ is not provided by the employer

Not answered

Marked out of Select one:

1.00
a. Statutory provident fund

b. Recognised provident fund

c. Public provident fund

d. Unrecognised provident fund

The correct answer is: Public provident fund

Question 7 The employees provident fund act covers establishments with more than
Not answered _______ employees.
Marked out of
1.00 Select one:
a. 25

b. 10

c. 20

d. 15

The correct answer is: 20

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8/29/2019 Unit Test-5(Defined Contributions)

Question 8 A provident fund is recognized when it is approved by the __________

Not answered

Marked out of Select one:

1.00
a. Commissioner of Sales Tax

b. Commissioner of Income Tax

c. None of the above

d. Provident Fund Commissioner

The correct answer is: Commissioner of Income Tax

Question 9 Section 80C benefit is not available to employee's contribution in

Not answered __________
Marked out of
1.00 Select one:
a. Public provident fund

b. Recognised provident fund

c. Unrecognised provident fund

d. Statutory provident fund

The correct answer is: Unrecognised provident fund

Question 10 A self employed person will not have the benefit of the following:
Not answered

Marked out of Select one:

1.00
a. Insurance pension plan

b. Mutual fund pension plan

c. Public provident fund

d. Employee Provident fund

The correct answer is: Employee Provident fund

Question 11 The pension received by an employee from the employer is

Not answered

Marked out of Select one:

1.00
a. Non taxable

b. Taxable

c. Tax deductible

d. Tax free

The correct answer is: Taxable

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8/29/2019 Unit Test-5(Defined Contributions)

Question 12 The central government contributes at the rate of __ to the Employees

Not answered Pension Scheme.
Marked out of
1.00 Select one:
a. 0.0116

b. 0.0833

c. 0.1

d. 0.12

The correct answer is: 0.0116

Question 13 Which one of the following is not an income?

Not answered

Marked out of Select one:

1.00
a. Dividend

b. Pension contribution

c. Interest

d. Salary

The correct answer is: Pension contribution

Question 14 Pension consists of ____________.

Not answered

Marked out of Select one:

1.00
a. A one time payment at the time of retirement

b. A fixed lumpsum at the time of retirement

c. An amount received every alternate year after retirement

d. A regular sum received regularly after retirement

The correct answer is: A regular sum received regularly after retirement

Question 15 Which of the following will advise you on the pension options?
Not answered

Marked out of Select one:

1.00
a. Financial planners

b. Investment professionals

c. All of the above

d. Professional money manager

The correct answer is: All of the above

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8/29/2019 Unit Test-5(Defined Contributions)

Question 16 Pension is a __________ for the employer.

Not answered

Marked out of Select one:

1.00
a. Benefit

b. Expenditure

c. Income

d. Profit

The correct answer is: Expenditure

Question 17 Pension received under the employees pension scheme is _______.

Not answered

Marked out of Select one:

1.00
a. Partly taxed

b. #

c. Tax free

d. Allowed a deduction from income

The correct answer is: #

Question 18 Pension received by a family member on the death of the individual is

Not answered _____.
Marked out of
1.00 Select one:
a. Taxable

b. Partly taxed

c. Allowed a deduction from income

d. Tax free

The correct answer is: Taxable

Question 19 Family pension gets the benefit of ______.

Not answered

Marked out of Select one:

1.00
a. Rebate

b. Tax free status

c. Exemption

d. Standard deduction of 1/3rd of the pension or Rs 15,000

whichever is lower

The correct answer is: Standard deduction of 1/3rd of the pension or Rs

15,000 whichever is lower

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8/29/2019 Unit Test-5(Defined Contributions)

Question 20 Amount of pension received from the employer is taxed as ______ .

Not answered

Marked out of Select one:

1.00
a. Capital gains

b. Income from other sources

c. Income from salaries

d. Income from business

The correct answer is: Income from salaries

Question 21 Mr. Mani Ratnam joins a private limited company covered under the PF
Not answered Act. The employer contributes for all the employees only up to the
Marked out of specified salary limit. His monthly salary consists of Rs.10,000 as basic,
1.00 Rs.5,000 as DA and 10% of the basic as HRA, what would be the
deduction from his monthly salary towards the statutory PF benefits?

Select one:
a. 1800

b. 1200

c. 1920

d. 780

The correct answer is: 780

Question 22 Mr. Mani Ratnam joins a private limited company covered under the PF
Not answered Act. The employer contributes for all the employees only up to the
Marked out of specified salary limit. His monthly salary consists of Rs.10,000 as basic,
1.00 Rs.5,000 as DA and 10% of the basic as HRA, calculate the EPS
contribution:5

Select one:
a. 1250

b. 1241

c. 833

d. 541

The correct answer is: 541

Question 23 _______ cannot open a new PPF account today.5

Not answered

Marked out of Select one:

1.00
a. None of the above

b. HUF

c. Individual

d. Minor

The correct answer is: HUF

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8/29/2019 Unit Test-5(Defined Contributions)

Question 24 A person receives Rs. 500 as pension from his employer plus another
Not answered Rs.1000 per month from other sources. The taxable amount in this case
Marked out of for the entire financial year is ________
1.00

Select one:
a. 15000

b. 12000

c. 6000

d. 18000

The correct answer is: 18000

Question 25 If family pension is received to the extent of Rs. 80000, the taxable
Not answered income is ________
Marked out of
1.00 Select one:
a. 65000

b. 30000

c. 50000

d. 80000

The correct answer is: 65000

Question 26 Ms. Bhagyashree has joined M/s Rajashree Production so covered under
Not answered the EPF Act, 1952. The employer contributes for all its employees to PF
Marked out of only up to the ""specified salary"" limit. Her monthly package consists of
1.00 Rs. 10,000 as Basic + 50% of Basic as Dearness Allowance + 10% of basic
as HRA. As a Financial Planner compute her contribution to Statutory PF

Select one:
a. Rs. 1200 per month

b. Rs. 1920 per month

c. Rs. 780 per month

d. Rs. 1800 per month

The correct answer is: Rs. 780 per month

Question 27 A person has invested Rs. 60000 in his PPF account at the start of the
Not answered financial year. He now wishes to open an account for his minor son what
Marked out of is the maximum amount that he can invest here?
1.00

Select one:
a. 10000

b. 20000

c. 70000

d. 60000

The correct answer is: 10000

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8/29/2019 Unit Test-5(Defined Contributions)

Question 28 An individual invests Rs. 50000 in his PPF account while having a
Not answered deduction of Rs. 24000 during the year as provident fund. Further
Marked out of insurance polices of Rs. 50000 premium were purchased. What is the tax
1.00 benefit available at the end of the year?

Select one:
a. 100000

b. 50000

c. 124000

d. 24000

The correct answer is: 100000

Question 29 A person has a basic salary of Rs. 35000 per month and there is a
Not answered provident fund deduction of 10% then how much will be the tax benefit
Marked out of available to the individual during the previous year?
1.00

Select one:
a. 3500

b. 38000

c. 42000

d. 35000

The correct answer is: 42000

Question 30 If Mr. Bose's employer had an approved Provident Fund for its employees
Not answered and were contributing to the Fund equal to the employees' contributions,
Marked out of the benefit scheme would fall under:5
1.00

Select one:
a. Defined benefit scheme

b. Either of the above

c. None of the above

d. Defined contributions scheme

The correct answer is: Defined contributions scheme

Question 31 The minimum amount of deposit in a PPF account each year is ____
Not answered

Marked out of Select one:

1.00
a. 300

b. 100

c. 500

d. 1000

The correct answer is: 500

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8/29/2019 Unit Test-5(Defined Contributions)

Question 32 The maximum amount that can be invested in a PPF account is ____
Not answered

Marked out of Select one:

1.00
a. 100000

b. 70000

c. 75000

d. 60000

The correct answer is: 70000

Question 33 The maximum benefit available for investment in PPF under Section 80C
Not answered of the Income tax is ___
Marked out of
1.00 Select one:
a. 60000

b. 70000

c. 100000

d. 75000

The correct answer is: 70000

Question 34 The PPF account can be extended __ number of times.

Not answered

Marked out of Select one:

1.00
a. 1

b. 5

c. unlimited

d. 3

The correct answer is: unlimited

Question 35 An investment in the PPF account can be made through ___

Not answered

Marked out of Select one:

1.00
a. Cash

b. All of the above

c. Cheque

d. Draft

The correct answer is: All of the above

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8/29/2019 Unit Test-5(Defined Contributions)

Question 36 A nomination once made in the PPF account ____

Not answered

Marked out of Select one:

1.00
a. cannot be cancelled

b. cannot be varied

c. can be cancelled

d. None of the above

The correct answer is: can be cancelled

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