Assertion (A): Indirect Taxes are regressive in their impact. Reason (R): They are levied at a uniform rate irrespective of the income level of the consumer. MCQ with Answer and Explanation

Assertion (A): Indirect Taxes are regressive in their impact. Reason (R): They are levied at a uniform rate irrespective of the income level of the consumer.
A. Both A and R are true but R is not the correct explanation of A
B. A is false but R is true
C. A is true but R is false
D. Both A and R are true and R is the correct explanation of A
Answer: Option D
Solution (By JKSSB Mock Tests)
Because indirect taxes (like GST) are charged flatly on goods, lower-income people pay a higher proportion of their income, causing a regressive effect.

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Practice More Accountancy and Book Keeping Questions

Question #1
Under the Companies Act 2013, which of the following companies are mandatorily required to constitute a CSR Committee?
A. All listed companies
B. Only government companies
C. Companies meeting any of the specified net worth, turnover, or net profit criteria during the immediately preceding financial year
D. Companies with more than 500 employees

Correct Answer: Option C


Explanation:
Section 135 mandates a CSR Committee for companies that meet specific thresholds of net worth (₹500 Cr+), turnover (₹1000 Cr+), or net profit (₹5 Cr+) in the preceding financial year.

Question #2
If a partner retires, the balance in his capital account is either paid off or transferred to his:
A. Loan Account
B. Current Account
C. Drawings Account
D. Suspense Account

Correct Answer: Option A


Explanation:
If the firm cannot pay cash immediately, the retiring partner's dues are transferred to a Loan Account, carrying an interest of 6% p.a.

Question #3
An unrecorded bank charge for ₹150 will be treated in BRS starting with Cash Book balance (Dr.):
A. Added ₹150
B. Deducted ₹150
C. Added twice
D. No adjustment

Correct Answer: Option B


Explanation:
Bank charges have been debited by bank in passbook, reducing the balance, but not recorded in cash book. To reconcile from cash book to passbook, we deduct the charges.