The 'Assessment Year' is the year: MCQ with Answer and Explanation

Question Report Error

The 'Assessment Year' is the year:

A. Calendar year

B. Same as previous year

C. In which income is earned

D. Immediately following the previous year, in which income is assessed and taxed

Answer: Option D

Solution (By JKExamLibrary)

Assessment year is the year following the financial year (previous year) in which tax is computed.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Practice More Accountancy and Book Keeping Questions

Question #1 Report Error

A: Internal audit is a continuous process. R: Internal audit is conducted by the statutory auditor. Choose the correct option.

A. Both A and R are true but R is NOT the correct explanation of A

B. A is false but R is true

C. A is true but R is false

D. Both A and R are true and R is the correct explanation of A

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Correct Answer: Option C

Explanation:
Internal audit is a continuous, ongoing appraisal system by the management. It is conducted by internal audit staff, not the statutory (external) auditor, who conducts the annual financial audit. A is true, R is false.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2 Report Error

The term 'Depletion' is used for:

A. Current assets

B. Intangible assets

C. Tangible fixed assets

D. Wasting assets like mines

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Correct Answer: Option D

Explanation:
Depletion refers to the exhaustion of natural resources like oil, minerals, timber.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #3 Report Error

S1: Capital expenditure increases the earning capacity of the business. S2: Revenue expenditure maintains the earning capacity of the business. Which statement(s) is/are correct?

A. Neither S1 nor S2

B. S1 only

C. Both S1 and S2

D. S2 only

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Correct Answer: Option C

Explanation:
Capital expenditure is incurred to acquire or improve assets, thereby increasing earning capacity. Revenue expenditure is incurred for day-to-day operations to maintain the existing earning capacity. Both statements are correct.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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