Which constitutional body recommends the distribution of net proceeds of taxes between the Union and the States? MCQ with Answer and Explanation

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Which constitutional body recommends the distribution of net proceeds of taxes between the Union and the States?

A. Public Accounts Committee

B. GST Council

C. Finance Commission

D. NITI Aayog

Answer: Option C

Solution (By JKSSB Mock Tests)

Constituted under Article 280, the Finance Commission makes recommendations regarding the sharing of tax revenues.

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

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Question #1

Direct taxes are progressive in nature because:

A. They are collected indirectly

B. Rate is same for all

C. Rate increases with income level

D. They are only on goods

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Correct Answer: Option C

Explanation:
Direct taxes like income tax have higher rates for higher income slabs, making them progressive.

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Question #2

The 'Directorate General of Foreign Trade' (DGFT) is under:

A. RBI

B. Ministry of Commerce and Industry

C. Ministry of Finance

D. Ministry of External Affairs

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Correct Answer: Option B

Explanation:
DGFT is the nodal agency for foreign trade policy under Ministry of Commerce.

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Question #3

Assertion (A): Under Ind AS 41, biological assets are measured at fair value less costs to sell. Reason (R): This is because biological transformation makes historical cost accounting less relevant for these assets. Choose the correct option.

A. Both A and R are true and R is the correct explanation of A

B. Both A and R are true but R is NOT the correct explanation of A

C. A is false but R is true

D. A is true but R is false

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Correct Answer: Option A

Explanation:
Ind AS 41 requires biological assets to be measured at fair value less costs to sell. This is because biological growth, degeneration, and production (transformation) make historical cost less meaningful. R correctly explains A.

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