A 'Flexible Budget' is also known as: MCQ with Answer and Explanation

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A 'Flexible Budget' is also known as:

A. Cash budget

B. Sliding scale budget

C. Master budget

D. Fixed budget

Answer: Option B

Solution (By JKSSB Mock Tests)

Flexible budget changes with activity levels, hence also called variable or sliding scale budget.

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

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Question #1

The term 'Trading on Equity' refers to:

A. Issuing more equity shares

B. Trading equity shares in the stock market

C. Using borrowed funds (debt) to magnify the return on equity

D. Distributing dividends from reserves

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Correct Answer: Option C

Explanation:
Trading on equity (financial leverage) means using fixed-cost debt to increase the earnings per share for equity shareholders when return on assets exceeds interest costs.

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

Question #2

The 'Anti-Profiteering' under GST ensures that:

A. Reduction in tax rates or benefit of ITC is passed on to consumers by reducing prices

B. Suppliers increase prices

C. No price change

D. Companies make no profit

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Correct Answer: Option A

Explanation:
Anti-profiteering provisions prevent unjust enrichment by suppliers.

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Question #3

Tax Audit under Income Tax Act is mandatory for businesses with turnover exceeding:

A. ₹10 crore

B. ₹2 crore

C. ₹50 lakh

D. ₹1 crore

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Correct Answer: Option D

Explanation:
Tax audit is required if turnover exceeds ₹1 crore in case of business (subject to digital transaction threshold of ₹10 crore in certain cases). Standard limit ₹1 crore.

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

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