In Social Accounting, an 'externality' refers to: MCQ with Answer and Explanation

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In Social Accounting, an 'externality' refers to:

A. Uncompensated impact of a firm's actions on third parties

B. External auditors

C. Foreign exchange transactions

D. Outsourced services

Answer: Option A

Solution (By JKSSB Mock Tests)

Externalities (like pollution) are costs or benefits affecting society that are not reflected in traditional financial statements.

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

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Question #1

The 'Institute of Chartered Accountants of India' (ICAI) was established by:

A. RBI

B. SEBI

C. An Act of Parliament

D. A resolution of Government

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Correct Answer: Option C

Explanation:
ICAI was established by the Chartered Accountants Act, 1949.

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Question #2

The 'MCA 21' portal is used for:

A. Income tax filing

B. Company incorporation, filing of financial statements, and other compliance

C. TDS return

D. GST filing

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Correct Answer: Option B

Explanation:
MCA 21 is the e-governance initiative of the Ministry of Corporate Affairs.

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Question #3

The 'Double Taxation Avoidance Agreement' (DTAA) aims to:

A. Avoid double taxation of same income in two countries

B. Unify all taxes

C. Increase tax rates

D. Tax income twice

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Correct Answer: Option A

Explanation:
DTAA provides relief from double taxation through exemption or credit method.

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

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