ELEMENTS OF AUDITING AND TAXATION MODEL QUESTION PAPER

GOVERNMENT OF KARNATAKA

DEPARTMENT OF TECHNICAL EDUCATION

BOARD OF TECHNICAL EXAMINATIONS

DIPLOMA IN COMMERCIAL PRACTICE

MODEL QUESTION PAPER

9CP62 - ELEMENTS OF AUDITING AND TAXATION (EOA&T)

Time: 3 Hours                                                                                                       Max.Marks: 100

 

Instruction: 1) Section – I is Compulsory

                   2) Answer any TWO full questions each from the Sections – II and III of Elements

                        of Auditing.

                   3) Answer any TWO full questions each from the Section IV of Taxation.

 

SECTION – I

 

1. (a) Fill in the blanks with appropriate word/words:                                                  5 X 1 = 5

 

(i)                 The Income Tax Act was passed in the year.......................

(ii)               Income Tax payable by an assessee on the income of the ................year.

(iii)             Income from .................is not taxable under the Head income from House Property.

(iv)             The Scope of total income is dertmined on the basis of ..........status.

(v)               ...............year means the financial year immediately preceeding the Assessment year.

 

            (b) Write a Short note on ‘Standard Deductions’.                                                  5 Marks

 

SECTION – II

 

(Answer any TWO full Questions from this Section)

 

            2.         (a) What do you understand by Auditing?                                                     3

                        (b) What are the Objects of Auditing?                                                           5

                        (c) Briefly describe the different types of Errors.                                          7

 

3.         (a) What do you mean by “Audit Planning’?                                                 3

                        (b) Briefly describe the steps to be followed in Audit Planning.                   5

                        (c) What are the important principles of Auditing?                                        7

 

4.         (a) What do you understand by ‘Internal Check’?                                         3

                        (b) What are the Objects of Internal Control?                                                5         

                        (c) Distinguish between Internal Check and Internal Control.                       7

 

 

SECTION – III

 

(Answer any TWO full Questions from this Section)

 

5.         (a) What is meant by ‘Verification’?                                                              3

                        (b) What are the Objects of Verification?                                                      5

(c) Distinguish between Verification and Valuation.                                     7

 

6.         (a) Who is an Auditor?                                                                                   3

                        (b) What are the Qualities to be possessed by an Auditor of a Company?    5

                        (c) What are the disqualifications of Auditors of Limited Companies?         7

 

7.         (a) How First Auditors of a Company are appointed?                                   3

(b) Briefly explain the important provisions pertaining to remuneration of 

     Auditors.                                                                                                    5

                        (c) Briefly describe the rights and duties of Auditors of Limited Companies.  

                                                                                                                                                7

 

SECTION –IV

 

(Answer any TWO Questions from this Section)

 

8. Dr. Aras Reddy is an Employee of Abhiram Company Limited of the previous year 2009 – 10. Basic Pay – 8, 000 pm, Dearness Allowance – 2,000 pm (200 pm at the time of entering), Family Allowance Rs. 600 pm, City Compensatory Allowance Rs.400 pm, Children Education Allowance for 2  children Rs. 300 pm per child, EA Rs. 1,400 pm, HRA 2,400 pm (rent paid Rs. 4,000pm) Company has provided free telephone at his residence Rs. 10,000 pa. Re-imbursement of Medical Expenses incurred in a Private Hospital amounted to Rs. 36,000. Company has paid his Income Tax Rs. 6,000 during the year, conveyance allowance Rs. 500 pa. The provisions of the following for his Domestic Servants who are paid by company, watchman Rs. 100 pm, Gardener Rs. 120 pm, Cook Rs. 200 pm, Sweeper Rs. 120 pm. The Company has contributed to his Reserve Provident Fund at 14% of Salary and Credited Rs. 14000 as interest at 14 % pa. Calculate the Income from Salary of Dr.Aras Reddy.

15 Marks

 

    9. Mr. Abhi Krishna Kumar owns 3 house properties of which he uses 3rd House

        Property for his residence. Following are the particulars:

 

PARTICULARS

HP 1

HP 2

HP 3

Standard Rent

26,000

10,000

-

Municipal Rental Value

24,000

8,000

10,000

Actual Rental Value

28,000

9,600

-

Municipal Tax

-

1,000

500

Municipal Tax due but not paid

1,500

1,000

500

How used

LOP

LOP

SOP

Repairs

1,200

400

300

Interest on Loan for Construction

-

1,000

-

Ground Rent

100

80

-

Collection Charges

1,000

100

100

 

The Assessee’s total income from other sources amounted to Rs. 40,000. You are required to compute his Gross Total income.

                                           15 Marks

1.      Write short notes on any three of the following:      

 

(i)    Residential Status

(ii)   House Rent Allowance

(iii)  Annual Value

(iv)  Assessee

(v)   Perquisites

       3 x 5 = 15 Marks

 

 

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