FIN623 Taxation Management MCQs and Subjective Questions Solved and Verified by Course Instructor of VU ,
Shared by Fuad Hasan from LMS Moderated Discussion Board
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FIN623 Taxation Management - Question: Subject: Depriciation |
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Dear sir, As u replied my question of depreciation, Then either the asset is disposed off or sold out.
If it is sold then the salvage value is booked and the asset is removed
from the Balance sheet. In above answer if the case is that the asset
is neither sold out or disposed off, and continuing in process what will
be the treatment. And if a some changes its status from individual to
Limited company than what will be the treatment of assets and
depreciation it the life of assets is more than 10 years. As fixed
assets value is not shown in individual balance sheet, now what will he
do? Regards.
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| Instructor's Reply: |
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All
the assets have their estimated useful life and depreciation is charged
uptill the end of the estimated useful life of the asset. It is
necessary for the companies to charge the depreciation. When the asset
is of no more use then it is disposed off or sold out. There is no other
method to deal assets. It is the normal process which is done in the
companies.
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FIN623 Taxation Management - Question:
No.concept is clear about "Accrual basis mandatory" adopt only the company or any firm. please shortly brief in this regards. Thanks. |
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| Instructor's Reply: |
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This
is the accounting system. It means that it is necessary for the
companies to adopt this system. The sole proprietor can use the cash
basis system of accounting.
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FIN623 Taxation Management - Question:
Dear
sir, In lecture 36 example 1, The salaries amount is added back as no
deduction at source is done. But the question is that if we take the
total amount Rs.350,000/- than tax calculation are done at a given rate,
but either this salary is for a single employee or more than 1
employees. If this salary is for 3 employees 100,000+100000+150000 per
Annam than why we deduct tax at source because their salary is tax
exempt according to schedule. And why these amounts are added back.
Similarly if this salary is for a single employee than there will be tax
deduction at source. So plz clear my point. Regards.
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| Instructor's Reply: |
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This
tax calculation is at the end of the company not at the end of
employees. On salaries tax was not deducted by the company that is why
that amount would become the income of the company and would be added
back, these amounts were added back and tax will be calculated on total
amount after adding back all the missing items given in the example.
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FIN623 Taxation Management - Question:
Mr. Tareen let out a house at the monthly rent of Rs. 150,000 and received a deposit of Rs. 65,000 not adjustable against the rent. What would be his tax payable? ► Rs. 3,250 ► Rs. 325 ► Rs. 92,400 ► Rs. 215,000 Yearly salary.....150000*12 = 1800000 +=non-adjustable advance = 6500 total = 1806500 Tax payable = 57500 + (806500=806500*10/100) tax payable= 138150 but there is not such option in above question. |
| Instructor's Reply: |
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Your answer is right. From where you have taken the question?
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FIN623 Taxation Management - Question:
Dear Sir, Explain me what is Flat Tax, Marginal Tax and Applicable Tax. |
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| Instructor's Reply: |
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A system in which all levels of income are taxed at the same rate.
Tax rate paid on an additional unit of income. In a progressive tax
regimen, the marginal tax rate increases as the income rises, and the
highest income bracket attracts the highest marginal tax rate.
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FIN623 Taxation Management - Question:
what does mean by the "filing of the tax return"? |
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| Instructor's Reply: |
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It means to submit the income tax form that includes the details of your income.
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FIN623 Taxation Management - Question:
formula of tax credit calculation
i) (A/B) * C
ii) (A/B)-C
iii) (A/B) + c
iv) All of the given options.
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| Instructor's Reply: |
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Dear Student,
This is the formula of tax credit calculation which is A/B*C.
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FIN623 Taxation Management - Question:
Mr.
A is an employee of Government of the Punjab, his data for the year
2009 is given below. Salary Rs. 60,000 per month Gratuity Rs. 1,000,000
Tax deducted at source Rs. 54,000 What will be the Mr. A's taxable
income for tax year 2009?
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| Instructor's Reply: |
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Gratuity
is exempt and tax deducted at source is subtracted after calculating
the taxable income. So the taxable income will be 60,000*12=72,000
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FIN623 Taxation Management - Question:
Mr.
Adeel owns a property which he has rented out for Rs.10, 000 per month.
The local authority has determined the rental value of the property as
Rs.144, 000. He has no other income. Required: What will be the fair
market value of the property? How much tax will be payable by Mr.khan
for the tax year 2009?
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| Instructor's Reply: |
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Total
rent will be 10,000*12= 120,000 and the value determined by the local
authority 144,000. The amount whichever will be higher will be the fair
market value so 144,000 is the fair market value.
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FIN623 Taxation Management - Question:
Dear sir, Please sir explain why below items are not included in the solution of assignment no 02.Please sir give me answer with detail. Compensation for early rumination Bench mark rate on loan Bench mark Thank You, |
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| Instructor's Reply: |
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Compensation
for early termination belongs to tax year 2011 as he was terminated on
December 2010. Bench mark rate is used for the clculation of loans given
to employees.
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FIN623 Taxation Management - Question:
Dear Sir, AOA, Please uploaded the rates of Page No.126 to Page No.130 of handouts according to tax year 2010.
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| Instructor's Reply: |
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Dear Student,
Only those rates which have changed have been updated and uploaded on the LMS. Those rates which have not changed have not been uploaded on the LMS. You can use the rates of Tax year 2009 in 2010 as they have not changed. So there are same for both tax years. |
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FIN623 Taxation Management - Question:
Dear
Sir, I am confused about taxable income of a salaried individual and
employee of a company. My question is, if all the employees salary of a
company are comes under tax rate, than 1.Either they are charged
individual (filing their returns individually) 2.Or the tax is deducted
by the company from their salary ( the return is submitted by the
company under expenses) If they are submitting their individual tax and
company also deduct the tax, than the salaried persons are double taxed?
Plz clear my point as m confused. As if company is not deducting the
tax from salary at source than it will not claim this salary as expense.
Or the only those employees are taxed whom salaries are not come under
the tax rate individually but from the company side the collectively
salaried is payable to tax. But if think so than the concept of
Deduction at source is failed. Waiting for your reply.
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| Instructor's Reply: |
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The
company deducts the tax of those persons who come under the minimum tax
bracket. Those who do not earn taxable income are not taxed. If the
company deducts the income tax of the salaried person then he would not
show this in his income tax return form, however he would show other
sources of income. Salaried persons are not doubled taxed.
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FIN623 Taxation Management - Question:
Dear
sir, As described the gems, stones, jewelry and antique which are not
held by the assesses for his family members are capital assets, and any
profit obtained by a person from their disposal is Capital Gain. On the
other hand a person who associate with this business the income obtained
is Income from Business. How can we differentiate it from each other.
Regards.
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| Instructor's Reply: |
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If
someone is involved in the trading of precious metals then this would
be his business and any profit from this will be business income. If the
asset is in the personal use of the family members then this is not the
capital asset and any gain from this will not be capital gain and vice
versa.
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FIN623 Taxation Management - Question:
dear Sir, plz tell me
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| Instructor's Reply: |
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Rates of tax year 2010 should be used. I shall post an announcement soon for the guidance of the students.
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FIN623 Taxation Management - Question:
This word that is AOP is alway create the confusion, when we calculate the practical question. Please shortly brief in this regards with an example. Thanks. |
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| Instructor's Reply: |
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It
stands for Association of Persons. When two or more persons combine for
a business activity to earn profit then this is known as Association of
Profits.
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