Sample Questions Challenge Status -Stage1 (F)

1)

A)
B)
C)
D)

Which of the following is not a basic and fundamental requirement for a contract to be legally enforceable?
(1)
The contract is globally enforceable.
There is an agreement between the parties or their power of attorney.
The parties have intended the agreement to be legally binding.
The contract must be supported by valid consideration.

2) A member shall disclose to all the prospective clients the capacity in which they are able to provide Financial Planning
services. This pertains to the Code of Ethics of ___________.
(1)

A)
B)
C)
D)
3)

A Systematic Investment Plan helps to manage ________.

(A) Volatility Risk
(B) Systematic Risk
(C) Unsystematic Risk

A)
B)
C)
D)
4)

5)

(1)

(A) & (B)

(A) only
(B) only
(A), (B) & (C)
A Client should be helped to set his/her financial goals in _________.

A)
B)
C)
D)

(1)

both current & future money terms

future money terms
current money terms
None of the above
Ram is a Financial Planner in a large firm. His wife has some large investments in shares of a few companies. Ram
is required to offer views on almost all of these holdings to clients. Under the Code of Ethics and Rules of
Professional Conduct ________.
(1)

A)
B)
C)
D)
6)

Ram will not violate the Code and the Rules if he does not disclose his wife s holdings
Ram has to disclose the fact to his client(s) so as to make them aware of any potential conflict of interest
Ram needs to disclose the holdings only if he himself has a beneficial interest in those shares so as to avoid
potential conflict of interest
Ram has to disclose these holdings only to his employers, if required by the firm s internal compliance rules
The primary objective in cash management is to ___________.

A)
B)
C)
D)
7)

Compliance
Fairness
Competence
Integrity

(1)

balance between liquidity needs and interest foregone on cash balances

maintain enough cash to meet all liquidity requirements
arrive at optimal cash balance based on a well drawn budget
minimise the cash balances to optimise interest earnings
The relationship of a Principal and an Agent may be created by _____.
(A) Express appointment
(B) The conduct of the parties
(C) By a Court of law

(1)

A)
B)
C)
D)
8)

A)
B)
C)
D)
9)

(C) Only
(A) & (B)
(B) & (C)
(A), (B) & (C)
Before providing Financial Planning to a prospective client it is mandatory that the planner discloses_________.
(1)
his credentials and educational background
the number of clients he presently advises
the size of his clients portfolio
how he will earn for the services he is providing
In law, considerations sufficient to support contracts fall into two categories, namely __________.

A)
B)
C)
D)
10)

explicit considerations & tacit considerations

executory considerations & recovered considerations
private ownership & corporate entities
executory considerations & executed considerations
Corporate agent can represent ___________.

A)
B)
C)
D)
11)

12)

13)

14)

15)

(1)

specific obligations for the rural sector and general obligations for the social sector
specific level of obligations to be met in these sectors for life insurers
specific obligations to be met in these sectors for all insurers
broad directional guidance to focus on these sectors
Which of the following is not a ratio to measure solvency of the client?

A)

(1)

Estate Duty Act

Section 6 of the Married Women s Property Act, 1874
Charity Commissioner
Indian Insurance Act, 1938
The Insurance Act, 1938, in respect of insurer obligations to the rural and social sector provides _____.

A)
B)
C)
D)

(1)

same as commercial contracts

governed by Regular Contract Act as well as Insurance Contract Act, 1999
different from regular contracts and is regulated by Insurance Contract Act 1999
similar to regular contracts, but have many distinct differences, with own set of principles
In India, statutory trust insurance policies are normally created pursuant to ____________.

A)
B)
C)
D)

(1)

it violates the principle of sharing of losses

it violates the principle of insurable interest
insurance companies may not be having capital to handle losses of such magnitude
catastrophes are very much insurable through good product design
Insurance contracts are __________.

A)
B)
C)
D)

(1)

only corporate insurance company

multiple insurance companies
only one insurance company
can obtain business only from corporate
A catastrophe is not likely to be insured because ______.

A)
B)
C)
D)

(1)

(1)

Savings Ratio

B)
C)
D)
16)

Non mortgage debt service ratio

Debt service coverage ratio
Debts to asset ratio
Ram needs to decide on taking insurance of his property against fire and other perils. This decision should depend
on ____________.
(1)

A)
B)
C)
D)

17)

age of the property

his ability to pay premium
the prevalent standard practice
his inability to afford financial consequences of self insurance

Deficit financing provision in the Budget will lead to the following/s.

(A) Increase in money supply
(B) Adjustment of interest rate
(C) Rise in prices
(D) Fall in national income.

A)
B)
C)
D)
18)

(1)

(A) only
(A) & (C) only.
(A), (B) & (C) only
All the above
Savitas monthly contribution to her company Provident Fund exceeds the statutory requirement by Rs. 5,000. She
plans to visit her son in the United States soon after retirement. If she does not claim her funds soon after
retirement, what are her rights?
(1)

A)
B)
C)
D)
19)

The fund will accumulate interest for a period of six months, beginning one month after retirement. No
interest is payable after this period.
The fund will continue to accumulate interest and she can claim it any time after her return.
The fund will accumulate interest for one year, from the date of retirement.
The fund will stop accumulating interest from the date of her retirement.
Deduction in respect of contributions to an annuity plan of certain pension funds under Section 80C of IT Act is
allowed to ___________?
(1)

A)
B)
C)
D)
20)

Any Assessee
Individual Assessee only
Individual or HUF
Individual, resident in India
Postal Life insurance is open only for employees of __________.

A)
B)
C)
D)
21)

Central and State government / P&T department

all Central and State Government Departments, Nationalized Banks, PSU, Financial Institutions, Local Bodies,
Educational Institutions aided by the Government etc.
Nationalised banks / PSUs / Zila Parishads etc
None of the above
The process of retirement planning would generally not involve ________.

A)
B)
C)
D)

(1)

(1)

concentrating on maximizing returns on Present / Past Investments

projecting individual needs and goals into the future and making sound financial plan
making a plan for management & disposition of assets at death
planning for staying physically healthy & making necessary psychological adjustment and to plan for housing
and leisure / work

22)

The matching contribution by the Government, to the Contributory Provident Fund, for its employees, is
____________.
(1)

A)
B)
C)
D)
23)

8.33%
12%
10%
None of the above
An establishment, with 100 employees, notified by The Central Government of India and which is also a factory
engaged in a specified industry, would be covered under Employees Provident Fund and Miscellaneous Provision
Act, 1952 if the number of employees, getting salary of Rs. 6,500 or less, is/are _____________.
(1)

A)
B)
C)
D)
24)

20 or more
It will be covered even if the income of all employees is above Rs. 6,500
1 or more
More than 20
Senior Citizens Savings Scheme is governed by which Act?

A)
B)
C)
D)
25)

Banking Regulation Act, 1949

Government Savings Bank Act, 1873
Small Savings & Misc. Savings Act, 1902
Companies Act, 1956
Reciprocal of P/E ratio, E/P ratio measures___________.

A)
B)
C)
D)
26)

A)
B)
C)
D)
27)

(1)

(1)

market price of a share

growth ratio
cost of debt
opportunity cost of capital
If the current share price is S and the set exercise price is X, the intrinsic value of the Call Option is ______.
(1)
Max ( 0, S-X ).
Max ( 0, X-S ).
Min ( 0, S-X ).
Min ( 0, X-S ).
Bond prices are sensitive to the coupon rate of the bond and the maturity term of the bond. Bond prices are less
sensitive to changes in interest rates when the bonds have_______.
(1)

A)
B)
C)
D)
28)

small coupons and short maturity

large coupons and long maturity
large coupons and short maturity
small coupons and long maturity
Among the given four bonds, each having a 20 years maturity, which one of them is the most volatile?

A)
B)
C)
D)
29)

Zero Coupon.
Treasury.
Municipal.
BB-rated corporate.
A PPF account was opened on 10th July 1990. It will mature on ________.

A)
B)

(1)

(1)

11/07/2005
10/07/2005

C)
D)
30)

09/07/2005
01/04/2006
Convertible debentures are valued on the basis of Market Value.

A)
B)
C)
D)
31)

This statement is false.

This statement is true.
Cannot say.
Sometimes.
T-bills pay interest to their investors by __________.

A)
B)
C)
D)
32)

33)

34)

35)

(1)

A Vakalatnama is required to be registered in accordance with Indian Registration Act.

A Vakalatnama is not required to be registered.
A Vakalatnama creates a special power of agency.
A Vakalatnama needs to be stamped in accordance with Article 48 and 52 of the Indian Stamp Act.
Unabsorbed depreciation can be carried forward for ____________.

A)
B)
C)
D)

(1)

(A) only
(B) only
(C) only
(A), (B) & (C)
Which of the following statements is true in case of a Vakalatnama?

A)
B)
C)
D)

(1)

T-bills pay no interest.

Coupon interest.
Possible price appreciation above their discounted price.
Difference between Issue price and face value.
The bid-ask spread is________.
(A) Brokers commission
(B) Dealers gross income from a transaction
(C) Larger for illiquid securities than for liquid ones.

A)
B)
C)
D)

(1)

(1)

8 years
4 years
Indefinite period
None of the above
Mukesh has taken a loan from his employer, a PSU, for pursuing his higher studies. The amount that he pays to his
employer for the loan for FY 2007-08 is Rs. 80,000. Out of this Rs. 30,000 is towards repayment of the capital
amount of the loan and the rest is towards repayment of interest. Deduction available to Mukesh u/s 80E of IT Act
would be _________.
(1)

A)
B)
C)
D)
36)

NIL
Rs. 80,000
Rs. 50,000
Rs. 30,000
Vineeta, an NRI, is 63 years of age. In her case, the maximum income not chargeable to tax in India for AY 200809 would be ________.
(1)

A)
B)
C)

Rs. 1,00,000
Rs. 1,85,000
Rs. 1,10,000

D)
37)

X is a property dealer who buys and sells housing property. He received some rent from a housing property held as
stock-in-trade in the Assessment Year 2008-09. This rental income would come under the head:
(1)

A)
B)
C)
D)
38)

Income under the head capital gains.

Business income.
Income from other sources.
Income from house property.
If an employer has made contribution in excess of 12% of salary to an unrecognized provident fund of an
employee, then such contribution in the hands of the employee ____________.
(1)

A)
B)
C)
D)
39)

in excess of 12% is treated as income

is treated as income in the hands of the employee
is not treated as income of the year in which contribution is made
None of the above
Donation to a notified temple attracts a deduction of________ u/s 80G of Income Tax Act.

A)
B)
C)
D)
40)

41)

(1)

100%
50% (only if it is for renovation or repairs)
50% (for any purpose)
NIL
(A) Coparcenaries are restricted to four degrees from the common ancestor.
(B) Coparcenaries are restricted to four degrees from the living holder of the HUF property.

A)
B)
C)
D)

(1)

(A) only is correct.

(B) only is correct.
Restricted to five degrees from the common ancestor.
Restricted to six degrees from the common ancestor.
If Reserve Bank of India wants to lower the interest rates in the economy, it would consider which of the following
option/s?
(A) Purchase government securities.
(B) Increase the reserve requirement of member banks.
(C) Increase the discount rate.
(D) Decrease the reserve requirement of member banks.
(2)

A)
B)
C)
D)
42)

(A) & (B) only

(A) & (D) only
(B) & (C) only
(A) only
Possession of the property is transferred to the Mortgagee in _______________.

A)
B)
C)
D)
43)

Rs. 1,45,000.

(2)

Usufructuary mortgage
English mortgage
mortgage by conditional sale
Simple mortgage
Which of the following acts committed by a CFP Certificant violates the Principal of Integrity?
(A) Having been requested, the certificant refuses to return clients funds.
(B) The certificant commingles clients funds with other clients funds.
(C) The certificant commingles clients funds with the certificants funds.
(D) The certificant keeps incomplete records on details of clients.

(2)

A)
B)
C)
D)
44)

(A) & (C)

(A), (C) & (D)
(C) only
(A), (B), (C), (D)
Consider a portfolio of two investments viz. A & B. The sum total of volatility of A and B respectively,
represented by standard deviation of the two investments, will be equal to the volatility of the portfolio as a whole
if _________.
(2)

A)
B)
C)
D)
45)

A and B have a correlation of 1

the portfolio is equally divided between A and B
A and B have a correlation of Zero
the return on the portfolio is equal to the sum of returns of A and B
Insurable liability in case of 3rd party liability insurance risk is best defined as:

A)
B)
C)
D)
46)

(2)

The risk that confronts every person or business from negligence.

The risk that confronts every person or business from a public wrong.
The risk that confronts every person or business resulting from intentional or unintentional behaviour that
could result in the injury of another person or damage to property.
The risk that confronts every person or business resulting from intentional behaviour that could result in the
injury of another person or damage to property.
(A) In level term insurance policies, the coverage remains constant throughout the term.
(B) The premium payable in level term insurance policies can remain same or increase with increase in insureds
age.
(2)

A)
B)
C)
D)
47)

(B) is correct
Neither (A) nor (B) are correct
Both (A) & (B) are correct
(A) is correct
Which of the following statement is false about warranty in an insurance contract?
(A) Declarations on the proposal form can be warranties by reference.
(B) Warranties help the insurer to ensure that the risk stays the same during currency of the policy.
(C) Warranties have to be followed literally.

A)
B)
C)
D)
48)

(2)

(A)
(B)
(A), (B) & (C)
None of the above
An insurance firm has to create and sell a policy to cover the risk of partial disability to workmen in a chemical
factory. Which of the following is not a relevant factor in pricing the policy?
(2)

A)
B)
C)
D)
49)

The ability of the insurance firm to deploy the premium and earn positive investment returns on the funds.
The ability of the workmen to bear the cost of the policy.
The extent of probable disability created due to the work environment and its impact on workmens earning
capability.
The willingness of the management of the firm to bear part of the costs of the premium.
Raj joins ABC Ltd. on 25th April 1967. ABC has 30 employees. If he is expected to retire on 15th November
2007, and his last drawn salary for gratuity purposes is Rs. 26,000 per month, what would be ABC Ltds liability
on account of Rajs gratuity entitlement if ABC Ltd is covered under the payment of Gratuity Act, 1972? (2)

A)

Rs. 6,00,000.

B)
C)
D)
50)

Rs. 5,20,000.
Rs. 3,50,000.
Rs. 3,12,000.
Amitabh wins Rs. 3 lakh in a television quiz show. He has no other income for the particular FY. Can he contribute
to PPF and claim deduction for this contribution?
(2)

A)
B)
C)
D)
51)

No
Yes
Limited to Rs 50,000
Limited to Rs 70,000
Kulkarni is running an unrecognised Provident Fund, because he has a smaller number of employees in his firm.
Which of the following is true about the tax status of such a fund?
(2)

A)
B)
C)
D)
52)

Only the employees contribution is eligible for a rebate under Section 80C.
Kulkarnis contribution as the employer is exempt from tax in his books.
The interest received on such unrecognised PFs is taxable every year.
Accumulated employees contribution is taxable at the time of retirement.
Abhishek is working for the Finance Ministry since October 1, 1993. He is entitled to a basic salary of Rs. 6,000
per month. Dearness Allowance is 40% of Basic Salary for retirement benefits. He retired from his job on January
1, 2007. He is entitled to the following benefits at the time of retirement. Gratuity = Rs. 98,000. Pension from
January 1, 2007 = Rs. 2,000 per month. Payment from recognized PF = Rs. 3,00,000. Encashment of earned leave
for 150 days = Rs. 36,000. He was entitled to 40 days leave for every completed year of service. He got 50% of
his pension commuted in lump sum w.e.f March 1, 2007 and received Rs. 1,20,000 as commuted pension.
Abhishek contributes Rs. 900 per month to RPF to which his employer contributes an equal amount. What is the
amount of commuted pension that will be exempt for Abhishek for the FY 2006-07?
(2)

A)
B)
C)
D)
53)

Rs. 1,20,000
Rs. 80,000
Rs. 40,000
NIL
Risk free rate of return is 8%, expected market premium is 15% and Beta of security is 0.80. What is the expected
rate of return of the security?
(2)

A)
B)
C)
D)
54)

13.6%
15.00%
12.00%
20.00%
If a Corporation declares and pays dividend, this transaction will________.

A)
B)
C)
D)
55)

(2)

reduce stockholders equity

increase liabilities
decrease net income
not affect total assets
Which of the following technical indicators measure the strength of the market by comparing the number of stocks
that advance or decline in a particular trading day?
(2)

A)
B)
C)
D)

Support level.
Breadth of the market.
Short interest.
Call-Put ratio.

56)

Dividend received by the writer of a Call during the life span of an Option __________.

A)
B)
C)
D)
57)

can be pocketed by the writer

has to be given to the buyer of the option, only if he eventually exercises the option
increases the premium value by an equivalent amount
decreases the strike price
For claiming deduction u/s 80C of IT Act for AY 2008-09, the investment in an eligible instrument has to be out of
the assessees income chargeable to tax in the FY 2007-08.
(2)

A)
B)
C)
D)
58)

Limited to Rs. 25,000

True.
False.
Limited to Rs. 50,000.
An HUF consisted of a father, who is a widower, his three sons and a daughter. Upon death of the father, what will
be the share of his daughter?
(2)

A)
B)
C)
D)
59)

Will not get any share.

One fourth plus one sixteenth of HUF property.
One fourth of HUF property.
One sixteenth of HUF property.
Vishal loans Rs. 5,00,000 to his HUF at the market rate of interest of 8%. During the FY 2007-08, the HUF earns
Rs. 75,000 as profit (before paying the interest) on the amount advanced by Vishal. Determine the amount to be
clubbed with the income of Vishal as per Sec. 64(2) of the IT Act.
(2)

A)
B)
C)
D)
60)

A)
B)
C)
D)
61)

Nil.
Rs. 75,000.
Rs. 35,000.
Rs. 40,000.
The NAV of a debt oriented Mutual Fund is 22.25 cum dividend. It has declared a dividend of 6%, record date
being 25th June 2007. Calculate the dividend receivable by an individual investor post tax if he holds 10,000 units.
(2)
Rs. 5,250.
Rs. 6,000.
Rs. 5,150
Rs. 4,653.
Data available for Arvind and Neha is:
Assets: Cash = Rs. 50,000, Savings A/C = Rs. 50,000, MMMF (Money market mutual funds) = Rs. 2,00,000,
Bonds = Rs. 2,50,000, Fixed Deposit = Rs. 1,50,000, Marketable Stocks = Rs. 5,00,000, Equity based Mutual
Funds = Rs. 30,000, Real Estate Vacant Plot = Rs. 5,00,000,
Yearly Expenses = Rs. 3,60,000, Yearly Income Net Of Taxes = Rs. 6,00,000.
Liabilities: Car loan = Rs. 2,50,000, House Loan = Rs. 8,00,000.
Yearly Expenses include EMI for car and House Loan. Find Basic Liquidity Ratio of the Couple?
(4)

A)
B)
C)
D)
62)

(2)

3.33
10
26.67
15.5
Which of the following financial transactions / events would affect net worth of your client?
(A) Repayment of a loan using fund from a savings account.
(B) Purchase of car which is 75% financed with 25% down payment.
(C) The Nifty is appreciating, and the client is holding Nifty Indexed Mutual Fund.

(D) Interest rate increases and the client holds substantial bond portfolio.

A)
B)
C)
D)
63)

(C) & (D)

(B) & (C)
(A), (C) & (D)
All of the above
Girish received an inheritance of Rs. 2 Lakh. He wants to withdraw equal periodic payments at the beginning of
each month for 10 years starting after 10 years. He expects to earn 12% annual interest, compounded monthly on
his investments. How much can he receive each month?
(4)

A)
B)
C)
D)
64)

Rs. 9,470
Rs. 9,376
Rs. 8,912
Rs. 8,824
Sajid has a pension policy details of which are given as under; 28 year PPT; Non Participating policy; Yearly
premium Rs. 10,000; guaranteed returns of Rs. 50/1,000 SA; SA during accumulation phase Rs. 3 Lakh; No riders.
What will be the value of the accumulated corpus just on completion of the premium paying term?
(4)

A)
B)
C)
D)
65)

Rs. 5.58 Lakh

Rs. 4.80 Lakh
Rs. 4.20 Lakh
Rs. 7.20 Lakh
Suryakant has an accident insurance policy which pays TPD benefit of Rs. 3,000 per week, for upto 104 weeks.
He meets with an accident and is disabled and bedridden for 6 months. He has available leave of 4 weeks, after
which he is on loss of pay. What benefit amount will he get from the insurance company?
(4)

A)
B)
C)
D)
66)

Rs. 66,000
Rs. 72,000
Rs. 60,000
Rs. 78,000
Ram had taken an endowment plan for 35 years on 20/05/1990 for a sum assured of Rs. 2.5 lakh, wherein premium
payable is Rs. 2,000 quarterly. He dies on 18/08/2006. Quarterly premium due in August 2006 was paid on
06/08/2006. Bonus vested: Rs. 1,44,000, Interim Bonus declared after valuation on 31/03/2005 is Rs. 68 per
thousand. What is the amount of claim payable under the policy?
(4)

A)
B)
C)
D)
67)

Rs. 4,11,000
Rs. 4,07,000
Rs. 3,57,600
Rs. 3,54,600
The cash purchase price of an item is Rs. 2,00,000. The selling company however offers installment plan, which
allows an immediate payment of Rs. 10,000 and a series of 5 half-yearly payments thereafter. The first installment
is payable after one and a half year. If the company wants rate of interest of 10% P.A. compounded half-yearly,
what will be the half-yearly installment?
(4)

A)
B)
C)
D)
68)

(4)

Rs. 43,885
Rs. 48,383
Rs. 50,802
Rs. 29,412
Sundar invests a sum of Rs. 72,000 at 5% p.a. After 7 years the rate of interest was changed to 5% p.a,
compounded half yearly. After a further period of 3 years the rate was again changed to 6% p.a, compounded
quarterly. What will Sundar get at the end of 15 years of commencement?
(4)

10

A)
B)
C)
D)
69)

Alok, age 25 years, plans to retire at age 60 and his life expectancy is 75 years. His current expenditure is Rs.
2,00,000 annually. He estimates no reduction of expenses post retirement. How much will he save per annum to
achieve his target, if inflation rate is 6% and expected yield from investment is 10%? Assume he wishes to leave an
estate of 10% of his savings at the time of retirement.
(4)

A)
B)
C)
D)
70)

Rs. 73,878
Rs. 9,612
Rs. 66,490
Rs. 8,651
The May futures contract on XYZ Ltd closed at Rs. 3,940 yesterday. It closes today at Rs. 3,898.60. The spot
closes at Rs. 3,800. Raju has a short position of 3,000 in the May futures contract. He sells 2,000 units of May
expiring put options on XYZ with a strike price of Rs. 3,900 for a premium of Rs. 110 per unit. What is his net
obligation to/from the clearing corporation today?
(4)

A)
B)
C)
D)
71)

Pay Rs. 3,44,200.

Receive Rs. 3,44,200.
Receive Rs. 6,40,000.
Pay Rs. 95,800.
A firm needs to borrow funds on a short term basis without reducing its current ratio below 1.25. The Firms current
assets and current liabilities are Rs. 1,600 and Rs. 1,000 respectively. What amount can the fund borrow? (4)

A)
B)
C)
D)
72)

Rs. 1,000
Rs. 1,500
Rs. 1,200
Rs. 1,400
Returns on a security held for 5 years by Praveen are: First year 7%, second year 3%, third year -9%, fourth year
6%, fifth year 10%. Find the standard deviation of the security.
(4)

A)
B)
C)
D)
73)

8.00%
6.59%
7.37%
8.5%
Mukesh purchased a bungalow near Mumbai on Jun 1, 2007 for Rs. 8 lakh and immediately thereafter on Jun 2,
2007 leased the same to a public limited company for a period of 99 years on annual lease of Rs. 2 per annum. The
terms of the lease provide that the lessee shall keep an interest free deposit of Rs. 22 lakh with the lessor during the
period of lease. Further, after 25 years, the lessee shall have an option to cancel the lease agreement in which case
the sum of Rs. 22 lakh shall be refunded immediately? What is the income under Capital Gains of Mukesh for FY
2007-08, if there is no other transaction?
(4)

A)
B)
C)
D)
74)

Rs. 1,40,000
Rs. 1,48,251
Rs. 1,58,242
Rs. 1,55,000

Nil as Mukesh has not sold the Bungalow but has leased it out.
Rs. 14,00,000.
The income of Mukesh will be Income from House Property of Rs 2 only.
The income of Mukesh will be Income from House Property of Rs 2 only + Notional interest on Rs. 22 lakh@
10% p.a.
Madhuri sells shares in PQR Ltd on 14th June, 2007 (off market), for a net consideration of Rs. 20,00,000 and
earns a long-term capital gain of Rs. 15,00,000. Within 3 months, she purchases a new residential house for Rs.

11

10,00,000. She owns no other house other than the new house. Now if Madhuri were to sell the new house within
one year of purchase for Rs. 15,00,000, the tax treatment in the year of sale would be ______.
(4)

A)
B)
C)
D)
75)

short-term capital gain of Rs. 5,00,000 and Long-term capital gain of Rs. 7,50,000
short-term capital gain of Rs. 5,00,000 and Long-term capital gain of Rs. 10,00,000
short-term capital gain of Rs. 7,50,000 and Long-term capital gain of Rs. 5,00,000
long-term capital gain of Rs. 12,50,000
Dr. Ashok and Dr. Pramod are partners in a clinic which is assessed as a Firm. Both contribute Rs. 3,00,000 each
and are sharing profit and loss equally. They are expecting a net profit (before considering interest and
remuneration to partners), as Rs. 6,00,000 for the previous year 2007-08. If the interest is allowed @ 10% pa,
calculate the tax liability of the Firm.
(4)

A)
B)
C)
D)

Rs. 91,390.
Rs. 85,500.
Rs. 86,330.
None of the above.

12

Keys for Challenge Status exams

Note: No negative marks for wrong answers
STAGE - 1
S No:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40

Correct
A
B
A
C
B
A
B
D
A
C
A
D
B
C
A
D
B
B
B
B
A
C
C
B
D
A
C
A
D
A
C
C
B
C
A
C
D
C
B
B
Total

Marks
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
40

S No:
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75

Grand Total

Correct
B
A
B
C
A
C
D
B
C
A
B
A
D
A
B
A
C
D
A
C
Total
B
A
B
C
A
B
B
C
A
B
D
B
B
A
C
Total

Marks
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
2
40
4
4
4
4
4
4
4
4
4
4
4
4
4
4
4
60

140

13