SEBI GRADE A Phase II PYQ

1.Where is BSE headquartered at? 7.The CRC issues_______ during the

A. Churchgate, Mumbai registration of a company.
B. Nariman Point, Mumbai A. Corporate Identification Number
C. Colaba, Mumbai B. Direction Identification Number
D. Dalal Street, Mumbai C. Tax Identification Number
E. Connaught Place, New Delhi D. Company Helpline Number
E. None of the above
2.What does DT in DTAA stand for?
A. Discounted Tax 8._______ type of Tax is handled by
B. Designated Tax the CBDT?
C. Double Taxation A. Indirect Tax
D. Direct Tax B. Direct Tax
E. None of the above C. Both A and B
D. None of A and B
3.What is Tally Software used for? E. There is no such body/organisation
A. Accounting as CBDT
B. Price Determination
C. Understanding Market Penetration 9.Based on which of the following is
D. Customer Acquisition GSTIN allotted?
E. None of the above A. Aadhaar Card
B. Passport
4.Select the organisation that regulates C. PAN
NBFCs. D. Driving Licence
A. NABARD E. None of the above
B. Ministry of Finance
C. RBI 10.According to the Constitution of
D. SEBI India, when a bill is presented in the
E. NHB Parliament of India, who decides
whether a Financial Bill is a money bill
5._________ is aimed to improve the or ordinary bill?
efficiency of welfare services intended A. Finance Minister of India
for girls in India. B. Prime Minister of India
A. Beti Bachao Beti Padhao C. Leader of the Opposition in Lok
B. Integrated Child Development Sabha
Services D. Speaker of the Lok Sabha
C. Sukanya Samridhi Yojana E. None of the above
D. Both B and C
E. Both A and C 11.What is the Bill of exchange drawn
in parts is known as?
6.JIT is used in which of the following? A. Bill in Quarters
A. Overheads Treatment B. Bill in Sets
B. Inventory Management C. Bill in Parts
C. Marketing D. Bill in Bricks
D. Scheduling E. Bill in Cases
E. None of the above

pg. 2
12.When partnership deed is not there, 17.What is the market for Gold and
how is the profit distributed among silver known as?
partners? A. Metal Market
A. Equally Distributed among the B. Sona Market
Partners C. Gold and Silver Market
B. As per the profit-sharing ratio of the D. Bullion Market
Partners E. Shine market
C. As per the seniority of the Partners
D. As per the mutual understanding of 18.What is the statistics of population
the Partners known as?
E. None of the above A. Ecology
B. Sociology
13.Under which list does Agriculture C. Anthropology
come? D. Demography
A. Union List E. None of the above
B. Concurrent List
C. State List 19.Find the type of error in the given
D. Restricted List sentence:
E. None of the above Rent Expenses were charged to the
books of accounts for 11 months, but it
14.Which section of IT Act, 1961 act is was not charged in the 12th month.
known as charging section? A. Errors of Commission
A. Section 10 B. Errors of Principle
B. Section 2 C. Errors of Omission
C. Section 4 D. There is no error
D. Section 139 E. None of the above
E. Section 141
20.Which animal is displayed in the
15.Identify the non-negotiable Make in India logo?
instrument from the following options? A. Tiger
A. Hundi B. Giraffe
B. Promissory Note C. Lion
C. Cheque D. Deer
D. Currency Note
E. Bills of Exchange E. None of Above

16.What is the performance approach 21.While calculating income from

through rewards and punishment house property, Municipal Taxes are
called? treated on ________ basis.
A. MBO
B. Eclectic Motivation A. Due
C. Transformational Approach B. Not Deductible
D. Carrots and Stick Approach C. Payment
E. None of the above D. Both A and C
E. None of the above

pg. 3
22.What does O in SWOT stand for? 27.What is the full form of CPM?
A. Outstanding A. Consumer Price Movement
B. Outright B. Critical Path Method
C. Organisation C. Customer Priority Mechanism
D. Opportunity D. Cost Profit Measurement
E. None of the above E. None of the above

23.Which of the following is also known 28.If the Contribution is = Rs 40,000;

as lender of last resort? Sales is = Rs 2,00,000. What is the P/V
A. SBI Ratio?
B. HDFC Bank A. 5%
C. ICICI Bank B. 20%
D. NABARD C. 80%
E. RBI D. 500%
E. None of Above
24.Which of the following organisation
is responsible for promotion and 29.What is the total number of
financing of MSMEs? schedules in the Companies Act,2013?
A. SEBI A. 5
B. RBI B. 6
C. SIDBI C. 7
D. NHB D. 2
E. NABARD E. 3

25.GST is applicable to 30.Which of the following would be

A. Whole of India given least priority at the time of
B. Whole of India excluding the Union liquidation of company?
Territories of Jammu & Kashmir and A. Preference Shareholders
Ladakh B. Debenture Holders
C. Whole of India excluding the north- C. Both A and B
eastern states D. Equity Shareholders
D. Whole of India excluding the Union E. Environment
Territories of Jammu & Kashmir and
Ladakh and the north-eastern states 31.Which of the following is a computer
E. None of above related crime?
A. Arms Trafficking
26.If the total Assets are - Rs 36,000; B. Tax Evasion
Liabilities are - Rs 16,000; What is the C. Burglary
amount of Equity? D. Cyber Crime
A. Rs 20,000 E. None of the above
B. Rs 52,000
C. Rs 56,000 32.What is ITNS 281 challan form used
D. Rs 10,000 for?
E. None of Above A. E-filing of taxes of individual
taxpayer

pg. 4
B. Depositing Advance Tax every E. None of the above
quarter
C. Refund of taxes 38.Debenture holders are
D. Depositing TDS/TCS amount paid________
E. None of the above A. Dividends
B. Interest
33.Labour Turnover = ________ C. Tax
A. The number of people working in the D. Both A and B
current period E. None of the above
B. The number of people who left the
organisation in the previous period 39.If there is no consideration, then the
C. Rate of change of labour force agreement is
D. The rate of the change in the wages A. Void
of the labour force B. Voidable
E. None of the above C. Legally Enforceable
D. Both A and B
34.What is the full form of BPO? E. None of the above
A. Business Productivity Optimisation
B. Business Process Outsourcing 40.If there is charge against company
C. Business Producing Operations properties, it is registered with
D. Batch Production Order A. SEBI
E. None of the above B. RBI
C. Registrar of Companies
35.The partner will open a current D. Central Government
account when partner has__________ E. None of the above
A. Fixed Capital
B. Fluctuating Capital 41.Narayan Murthy is the founder
C. Leveraged Capital of_________
D. All of the above A. Infosys
E. None of the above B. TCS
C. Tech Mahindra
36.Which language is used for creating D. WIPRO
web page? E. None of the above
A. C++
B. SQL 42.Full form of NAV is terms of Mutual
C. Python Fund is__________
D. HTML A. Net Acquired Value
E. None of the above B. Non-Attractive Valuation
C. Net Appraised Value
37.Start or Re-start of computer is D. Net Asset Value
known as_______ E. None of the above
A. Firewall
B. Adware 43.What is the meaning of C in LCR?
C. Booting A. Coverage
D. Formatting B. Conditional

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C. Counter C. Feedforward Control
D. Carriage D. Both A and B
E. None of the above E. None of the above

44.Which of the following can be 48.What kind of ratio is a Current

considered as FDI apart from investing Ratio?
in one's home currency? A. Liquidity
A. Investing in equity stocks B. Activity
B. Remittance of money through bank C. Profitability
account D. Solvency
C. Both A and B E. None of the above
D. Setting up a manufacturing unit 49.Current assets are assets expected
E. None of the above to be realised within
A. 90 days
45.Provision of tax is under which sub- B. 180 days
head in balance sheet C. 1 year
A. Long-term provisions D. 2 years
B. Short-term assets E. None of the above
C. Long-term liabilities
D. Short-term provisions 50.The ________ states that other
E. None of the above factors being constant, price and
quantity demand of any good and
46.Debit what comes in, credit what service are inversely related to each
goes_____ other.
A. Up A. Law of Demand
B. Down B. Law of Supply
C. Out C. Law of Diminishing Marginal Utility
D. Diagonal D. Law of Variable Proportion
E. None of the above E. None of the above

47.Which of the following would be best

for process improvement?
A. Concurrent Control
B. Feedback Control

pg. 6
 ###ANSWERS###
1. Ans. D. latest version of Tally is Tally ERP 9.
BSE Limited, also known as the Tally ERP 9 Software is one of the most
Bombay Stock Exchange, is an Indian financial accounting systems used in
stock exchange located on Dalal Street India. For small and medium
in Mumbai. Established in 1875, it is enterprises, it is complete enterprise
Asia's oldest stock exchange. software.
4. Ans. C.
2. Ans. C. Non-Banking Financial Companies
DTAA stands for Double Taxation (NBFCs) are regulated and governed by
Avoidance Agreement. The Double Tax Reserve bank of India (RBI). As per
Avoidance Agreement (DTAA. is a tax section 45-1A of the Reserve Bank of
treaty signed between two or more India Act, 1934, an NBFC cannot carry
countries to help taxpayers avoid on non-banking financial activities
paying double taxes on the same unless it has certificate of registration
income. A DTAA becomes applicable in and net owned fund of 2 crore.
cases where an individual is a resident 5. Ans. A.
of one nation but earns income in Beti Bachao, Beti Padhao is a campaign
another. India has comprehensive of the Government of India that aims
double taxation avoidance agreement to generate awareness and improve
with 88 countries, out of which 85 have the efficiency of welfare services
entered into force. This means that intended for girls in India.
there are agreed rates of tax and 6. Ans. B.
jurisdiction on specified types of The just-in-time (JIT) inventory system
income arising in a country to a tax is a management strategy that aligns
resident of another country. Under the raw material orders from suppliers
Income Tax Act 1961 of India, there directly with production schedules.
are two provisions, Section 90, and Companies employ this inventory
Section 91, which provide specific relief strategy to increase efficiency and
to taxpayers to save them from double decrease waste by receiving goods only
taxation. Section 90 (bilateral relief) is as they need them for the production
for taxpayers who have paid the tax to process, which reduces inventory
a country with which India has signed costs. This method requires producers
double taxation avoidance agreements, to forecast demand accurately.
while Section 91 (unilateral relief) 7. Ans. A.
provides benefit to tax payers who During the incorporation of a company,
have paid tax to a country with which the CRC issued Corporate Identification
India has not signed an agreement. Number to a company.
Thus, India gives relief to both kinds of 8. Ans. B.
taxpayers. The rates differ from The Direct Taxes are handled by the
country to country. Central Board of Direct Taxes (CBDT).
3. Ans. A. The Income Tax Department also
Tally is an ERP accounting software referred to as IT Department or ITD is
package that is used to record day to a government agency undertaking
day business data of a company. The direct tax collection of the Government

pg. 7
of India. It functions under the In accordance with the provisions of
Department of Revenue of the Ministry the partnership deed, the profits and
of Finance. Income Tax Department is losses made by the firm are distributed
headed by the apex body Central Board among the partners. However, sharing
of Direct Taxes (CBDT). of profit and losses is equal among the
9. Ans. C. partners, if the partnership deed is
GSTIN, known as GST Identification silent.
Number, is assigned to every GST
registered person. Each taxpayer is In accordance with the provisions of
assigned a state-wise PAN-based 15- the partnership deed, the profits and
digit Goods and Services Taxpayer losses made by the firm are distributed
Identification Number (GSTIN). among the partners. However, sharing
• The first two digits represent the of profit and losses is equal among the
state code as per Indian Census 2011. partners, if the partnership deed is
Every state silent.
has a unique code. For instance, 13. Ans. C.
- State code of Karnataka is 29 Under the State List, “agriculture" is
- State code of Delhi is 07 mentioned in entry 14. So, states are
• The next ten digits will be the PAN entirely competent to enact laws on
number of the taxpayer agriculture. Entry 18 mentions, inter-
• The thirteenth digit will be assigned alia, "transfer and alienation of
based on the number of registrations agricultural land".
within a 14. Ans. C.
state Section 4 of the Income Tax Act, 1961
• The fourteenth digit will be “Z” by (the Act), is the basic charging section
default under which income tax is chargeable
• The last digit will be for check code. on the total income of every person.
It may be an alphabet or a number. 15. Ans. D.
10. Ans. D. Currency is a legal tender which gives
The definition of "Money Bill" is given in the holder the right to receive the value
Article 110 of The Constitution of India. of its denomination on exchange. So
A financial bill is not a Money Bill unless "holding" determines the entitlement.
it fulfils the requirements of Article A holder of a negotiable instrument, if
110. he is not the payee, is entitled to
The Speaker of the Lok Sabha certifies receive the payment only from the
if a financial bill is a Money Bill or not. transferor. So, if the title of the
11. Ans. B. transferor is defective, then holder's
Bills are sometimes drawn in several title also become defective unless he is
parts. All the parts so drawn are a holder in due course. In which case
referred as bill 'drawn in sets'. The he must prove that he has obtained the
drawer of the 'bills in sets' must sign all instrument for a valuable consideration
the parts and deliver all the parts but and in good faith before maturity. A
the acceptance should be written only negotiable instrument is something in
on one part. lieu of currency, which makes it a form
12. Ans. A.

pg. 8
of credit. Whereas currency is used for receivable/received/deemed rent for
current payment. the property.
16. Ans. D. 22. Ans. D.
Carrot and stick motivation is a SWOT = Strengths, Weaknesses,
motivational approach that involves Opportunity, Threats
offering a "carrot" (a reward-for good 23. Ans. E.
behaviour) and a "stick” (a negative A lender of last resort is whoever you
consequence for poor behaviour). It turn to when you urgently need funds
motivates staff by creating actionable and you've exhausted all your other
goals and desirable rewards for options. Banks typically turn to their
employees who can alter their lender of last resort (the Central Bank
behaviour and performance. of the country) when they cannot get
17. Ans. D. the funding they need for their daily
A bullion market is a market through business.
which buyers and sellers trade gold and RBI is the official lender of the last
silver as well as associated derivatives. resort in India. Lender of the last resort
The bullion market is the primary means Central bank coming to the
source of gold and silver trading quotes rescue of other banks in times of
throughout the day. Multiple bullion financial crisis.
markets exist across the globe. 24. Ans. C.
18. Ans. D. The SIDBI (Small Industries
Demography is the statistical study of Development Bank of IndiA. is a wholly
populations, especially human beings. owned subsidiary of IDBI (Industrial
Demographic analysis can cover whole Development Bank of IndiA.,
societies or groups defined by criteria established under the special Act of the
such as education, nationality, religion, Parliament 1988 which became
and ethnicity. operative from April 2, 1990.
19. Ans. C. SIDBI was made responsible for
The error of omission refers to the error administering Small Industries
in which a transaction is not at all Development Fund and National Equity
recorded in the books, either Fund that were administered by IDBI
completely or partially. before. SIDBI is the Primary Financial
20. Ans. C. Institution for promoting, developing
The Make in India logo is the silhouette and financing MSME (Micro, Small and
of a lion on the prowl, made entirely of Medium Enterprise. sector. Besides
cogs, symbolizing manufacturing, focussing on the development of the
strength, and national pride. Micro, Small and Medium Enterprise
21. Ans. C. sector, SIDBI also promotes cleaner
Municipal taxes paid: Any taxes paid to production and energy efficiency.
the Government during the financial SIDBI helps MSMEs in acquiring the
year (for which the income is being funds they require to grow, market,
computed on the property owned, such develop and commercialize their
as house tax, are allowed for deduction technologies and innovative products.
from the Gross Annual Value which is The bank provides several schemes
calculated on the basis of the total rent and offers financial services and

pg. 9
products for meeting the individual's Shareholders would be given the least
requirement of various businesses. priority.
25. Ans. A. 31. Ans. D.
After the enactment of various GST Cyber-crime - crimes done by
laws, Goods and Services Tax was computer. Examples of cyber-crime
launched all over India with effect from include:
1 July 2017. The Jammu and Kashmir Computer hacking (where a person
state legislature (then a full statE. breaks into a computer using another
passed its GST act on 7 July 2017, computer, and steals information)
thereby ensuring that the entire nation Cyber stalking (following someone all
is brought under a unified in direct the time, using a computer, to make
taxation system. them feel scareD.
26. Ans. A. E-mail fraud (for example, emailing
Fundamental Accounting Equation - people asking to send money in scams)
Assets = Liabilities + Equity Spam (where "spammers" get email
=> Rs 36,000 = Rs 16,000 + Equity addresses for thousands of people and
=> Rs 36,000 - Rs 16,000 = Equity send them all unwanted ads)
Or Rs 20,000 = Equity 32. Ans. D.
27. Ans. B. Challan number /ITNS 281 is used to
Critical path method (CPM) is a deposit Tax deducted at source (TDS)
resource-utilization algorithm for or Tax collected at source (TCS). TDS
scheduling a set of project activities. challan status can be filled by corporate
The essential technique for using CPM or non-corporate entities. Any taxpayer
is to construct a model of the project can do the income tax challan 281
that includes the following: A list of all payment online on the TIN NSDL
tasks required to complete the project. website.
The dependencies between the tasks. 33. Ans. C.
28. Ans. B. Labour turnover may be defined as the
P/V Ratio = (Contribution / Sales)*100 number of workers replaced during a
= (Rs 40,000 / RS 2,00,000)*100 = given period relative to the average
20% labour force during the period. It is the
29. Ans. C. number of workers who left the job
The Companies Act, 2013 is divided during a period relative to the average
into 29 chapters containing 470 labour force during the period.
sections as against 658 Sections in the 34. Ans. B.
Companies Act, 1956 and has 7 Business process outsourcing (BPO) is
schedules. a method of subcontracting various
30. Ans. D. business related operations to third-
At the time of liquidation of companies, party vendors.
The Creditors or Debenture Holders 35. Ans. A.
would be given the priority for payment A current account is opened when the
of their money, then the preference capital of partners is fixed. In such a
would be given to Preference case, all transactions relating to
Shareholders and the Equity (except introduction and withdrawal of
capital) interest on capital, interest on

pg. 10
drawings, salary to partners, etc. are 40. Ans. C.
done from/through the current Section 77 to 87 of the Companies Act
account. 2013 provides the procedure for the
36. Ans. D. registration of Charges.
HTML (Hypertext Markup Language. is Every company, creating or modifying
the code that is used to structure a web a Charge on its property, assets or
page and its content. For example, undertakings, whether it is tangible, or
content could be structured within a set intangible situated within or outside
of paragraphs, a list of bulleted points, India, shall register the particular of
or using images and data tables. Charge with the Registrar within 30
37. Ans. C. days of such creation by applying Form
Start or re-start of computer is known No. CHG-1 (for other than debentures)
as Booting and Form No. CHG-9 (for debentures).
38. Ans. B. Along with the Form CHG-1 or CHG-9,
Debenture holders are paid interest on the documents such as a certified true
their lent money at a fixed/ agreed copy of every instrument evidencing
rate. creation or modification of the Charge
39. Ans. A. particular of other Charge holders in
A contract is an agreement enforceable case of joint Charge and consortium
by law. A void agreement is one which finance, and in case of acquisition of
cannot be enforced by law. Sometimes property which is already subject to
an agreement which is enforceable by charge instrument evidencing such
law, i.e., a contract, can become void. acquisitions, are filed.
Void agreements are different from 41. Ans. A.
voidable contracts, which are contracts Infosys was founded in 1981 by seven
that may be nullified. An agreement to engineers- N. R. Narayana Murthy,
carry out an illegal act is an example of Nandan Nilekani, N. S. Raghavan, S.
a void agreement. For example, an Gopalakrishnan, S. D. Shibulal, K.
agreement between drug dealers and Dinesh, and Ashok Arora in Pune,
buyers is a void agreement simply India.
because the terms of the contract are 42. Ans. D.
illegal. In such a case, neither party can Net Asset Value (NAV) is calculated as
go to court to enforce the contract. A the current value of total assets minus
void agreement is void ab initio, i.e., the total value of all liabilities, divided
from the beginning while a voidable by the total number of outstanding
contract can be voidable by one or all units. NAV allows an investor to track
the parties. A voidable contract is not the performance of a fund.
void ab initio, rather, it becomes void 43. Ans. A.
later due to some changes in condition. LCR = Liquidity Coverage Ratio. The
In sum, there is no scope of any liquidity coverage ratio (LCR) refers to
discretion on the part of the contracting the proportion of highly liquid assets
parties in a void agreement. The held by financial institutions, to ensure
contracting parties do not have the their ongoing ability to meet short-
power to make a void agreement term obligations.
enforceable. 44. Ans. D.

pg. 11
Setting up a manufacturing unit can be accounts and then diligently apply the
considered as an FDI rules.
45. Ans. D. 47. Ans. B.
Provision of tax is under Short-term Feedback control is a process that
provisions in the balance sheet. managers can use to evaluate how
46. Ans. C. effectively their teams meet the stated
The Golden Rules of Accounting goals at the end of a production
Debit The Receiver, Credit The process. Feedback control evaluates
Giver the team's progress by comparing the
This principle is used in the case of output the team was planning on
personal accounts. When a person producing to what was produced.
gives something to the organization, it 48. Ans. A.
becomes an inflow and therefore the The current ratio is a liquidity ratio that
person must be credit in the books of measures a company's ability to pay
accounts. The converse of this is also short-term obligations or those due
true, which is why the receiver needs within one year. It tells investors and
to be debited. analysts how a company can maximize
Debit What Comes In, Credit What the current assets on its balance sheet
Goes Out to satisfy its current debt and other
This principle is applied in case of real payables.
accounts. Real accounts involve 49. Ans. C.
machinery, land and building etc. They Current assets are assets expected to
have a debit balance by default. Thus, be realised within 1 year.
when you debit what comes in, you are 50. Ans. A.
adding to the existing account balance. The law of demand states that other
This is exactly what needs to be done. factors being constant (cetris peribus),
Similarly, when you credit what goes price and quantity demand of any good
out, you are reducing the account and service are inversely related to
balance when a tangible asset goes out each other. When the price of a product
of the organization. increases, the demand for the same
Debit All Expenses and Losses, product will fall.
Credit All Incomes and Gains
This rule is applied when the account in
question is a nominal account. The
capital of the company is a liability.
Therefore, it has a default credit
balance. When you credit all incomes
and gains, you increase the capital and
by debiting expenses and losses, you
decrease the capital. This is exactly
what needs to be done for the system
to stay in balance.
The golden rules of accounting allow
anyone to be a bookkeeper. They only
need to understand the types of

pg. 12