A 'Non-Resident' is a person who: MCQ with Answer and Explanation

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A 'Non-Resident' is a person who:

A. Has income only outside India

B. Lives abroad permanently

C. Is a foreign citizen

D. Does not satisfy the basic conditions of residence

Answer: Option D

Solution (By JKSSB Mock Tests)

Non-resident status is determined by fulfilling conditions under Section 6 of Income Tax Act.

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

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Question #1

The main difference between cash basis and accrual basis is:

A. Trial balance preparation

B. Use of vouchers

C. Recording of transactions

D. Timing of recognition of revenues and expenses

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Correct Answer: Option D

Explanation:
Cash basis recognises on cash flow; accrual on earning/incurring.

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Question #2

Which budget estimates the amount of cash receipts and cash payments during the budget period?

A. Production Budget

B. Capital Budget

C. Sales Budget

D. Cash Budget

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Correct Answer: Option D

Explanation:
A cash budget forecasts the cash inflows and outflows to ensure the firm has adequate liquidity to operate.

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Question #3

The closing entry for transferring purchases account is:

A. Purchases A/c Dr. To Trading A/c

B. Profit & Loss A/c Dr. To Purchases A/c

C. Trading A/c Dr. To Purchases A/c

D. Capital A/c Dr. To Purchases A/c

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Correct Answer: Option C

Explanation:
At year-end, purchases account balance is transferred to Trading Account by debiting Trading A/c and crediting Purchases A/c.

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