On which do Companies pay Corporation Tax? ?->(Show Answer!)

1. On which do Companies pay Corporation Tax?

Answer: Incomes

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MCQ-> Study the information given below and answer the questions.The following table contains the pre and post revision pay structure of a Government department

The revision has been done based on the following terms: -In pre-revised pay scale, the basic pay is the sum of the minimum pay in the appropriate pay scale and the admissible increment. After revision, the basic pay is the sum of minimum pay in the appropriate pay scale and the respective grade pay and the admissible increments. -Annual increment of 3% of the basic pay (on a compounded basic) is paid under the revised pay rules. -Monthly Dearness Allowance (DA) is calculated as percentage of basic pay. -In pre-revised pay scales, the increment was given after the completion of each year of service, but, after revision annual increments are given only in the month of July every year and there should be a gap of six months between the increments. The employees who had joined the department in the month of September, October, November and December are given an increment at the time of revised pay fixation in September, 2008. The revised pay is applicable from 1st September, 2008.Abhijit joins the department on November 10, 2006 in the pay scale of Rs. 18,400-500-22,400 with the pay of Rs. 18,400 plus 2 increments. What is his basic salary, after revision, on August 1, 2009?
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MCQ-> Governments looking for easy popularity have frequently been tempted into announcing giveaways of all sorts; free electricity, virtually free water, subsidized food, cloth at half price, and so on. The subsidy culture has gone to extremes. The richest farmers in the country get subsidized fertilizers. University education, typically accessed by the wealthier sections, is charged at a fraction of cost. Postal services are subsidized, and so are railway services. Bus fares cannot be raised to economical levels because there will be violent protest, so bus travel is subsidized too. In the past, price control on a variety of items, from steel to cement, meant that industrial consumer of these items got them at less than actual cost, while the losses of the public sector companies that produced them were borne by the taxpayer! A study done a few years ago, came to the conclusion that subsidies in the Indian economy total as much as 14.5 per cent of gross domestic product. At today's level, that would work out to about 1,50,000 crore. And who pay the bill? The theoryand the Political fiction on the basis of I which it is sold to unsuspecting votersis that subsidies go the poor. and are paid for by the rich. The fact is that most subsidies go the 'rich' (defined in the Indian context as those who are above the poverty line), and much of the tab goes indirectly to the poor. Because the hefty subsidy bill results in fiscal deficits, which in turn push up rates of inflationwhich, as everyone knows, hits the poor the hardest of all. That is why taxmen call inflation the most regressive form of taxation. The entire subsidy system is built on the thesis that people cannot help themselves, therefore governments must do so. That people cannot afford to pay for variety of goods and services, and therefore the government must step in. This thesis has been applied not just in the poor countries but in the rich ones as well; hence the birth of the welfare state in the west, and an almost Utopian social security system; free medical care, food aid, old age security, et.al. But with the passage of time, most of the wealthy nations have discovered that their economies cannot sustain this social safety net, which in fact reduces the desire among people to pay their own way, and takes away some of the incentive to work, in short, the bill was unaffordable, and their societies were simply not willing to pay. To the regret of many, but because of the laws of economies are harsh, most Western societies have been busy pruning the welfare bill. In India, the lessons of this experience over several decades, and in many countriesdo not seem to have been learnt. Or they are simply ignored in the pursuit of immediate votes. People who are promised cheap food or clothing do not in most cases look beyond the gift horsesto the question of who picks up the tab. The uproar over higher petrol, diesel and cooking gas prices ignored this basic question; if the user of cooking gas does not want to pay for its cost, who should pay? Diesel in the country is subsidised, and if the user of cooking gas does not want to pay for its full cost, who does he or she think should pay the balance of the cost? It is a simple question, nevertheless if remains unasked. The Deva Gowda government has shown some courage in biting the bullet when it comes to the price of petroleum products. But it has been bitten by much bigger subsidy bug. It wants to offer food at half its cost to everyone below the poverty line, supposedly estimated at some 380 million people. What will be the cost? And of course, who will pick up the tab? The Andhra Pradesh Government has been bankrupted by selling rice as 2 per kg. Should the Central Government be bankrupted too, before facing up to the question of what is affordable and what is not? Already, India is perennially short of power because the subsidy on electricity has bankrupted most electricity boards, and made private investment wary unless it gets all manner of state guarantees. Delhi's subsidised bus fares have bankrupted the Delhi Transport Corporation, whose buses have slowly disappeared from the capital's streets. It is easy to be soft and sentimental, by looking at programmes that will be popular. After all, who does not like a free lunch? But the evidence is surely mounting that the lunch isn't free at all. Somebody is paying the bill. And if you want to know who, take at the country's poor economic performance over the years. Which of the following should not be subsidised over the years ?
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MCQ-> Read the following passage carefully and answer the questions given at the end.Passage 4Public sector banks (PSBs) are pulling back on credit disbursement to lower rated companies, as they keep a closer watch on using their own scarce capital and the banking regulator heightens its scrutiny on loans being sanctioned. Bankers say the Reserve Bank of India has started strictly monitoring how banks are utilizing their capital. Any big-ticket loan to lower rated companies is being questioned. Almost all large public sector banks that reported their first quarter results so far have showed a contraction in credit disbursal on a year-to-date basis, as most banks have shifted to a strategy of lending largely to government-owned "Navratna" companies and highly rated private sector companies. On a sequential basis too, banks have grown their loan book at an anaemic rate.To be sure, in the first quarter, loan demand is not quite robust. However, in the first quarter last year, banks had healthier loan growth on a sequential basis than this year. The country's largest lender State Bank of India grew its loan book at only 1.21% quarter-on-quarter. Meanwhile, Bank of Baroda and Punjab National Bank shrank their loan book by 1.97% and 0.66% respectively in the first quarter on a sequential basis.Last year, State Bank of India had seen sequential loan growth of 3.37%, while Bank of Baroda had seen a smaller contraction of 0.22%. Punjab National Bank had seen a growth of 0.46% in loan book between the January-March and April-June quarters last year. On a year-to-date basis, SBI's credit growth fell more than 2%, Bank of Baroda's credit growth contracted 4.71% and Bank of India's credit growth shrank about 3%. SBI chief Arundhati Bhattacharya said the bank's year-to-date credit growth fell as the bank focused on ‘A’ rated customers. About 90% of the loans in the quarter were given to high-rated companies. "Part of this was a conscious decision and part of it is because we actually did not get good fresh proposals in the quarter," Bhattacharya said.According to bankers, while part of the credit contraction is due to the economic slowdown, capital constraints and reluctance to take on excessive risk has also played a role. "Most of the PSU banks are facing pressure on capital adequacy. It is challenging to maintain 9% core capital adequacy. The pressure on monitoring capital adequacy and maintaining capital buffer is so strict that you cannot grow aggressively," said Rupa Rege Nitsure, chief economist at Bank of Baroda.Nitsure said capital conservation pressures will substantially cut down "irrational expansion of loans" in some smaller banks, which used to grow at a rate much higher than the industry average. The companies coming to banks, in turn, will have to make themselves more creditworthy for banks to lend. "The conservation of capital is going to inculcate a lot of discipline in both banks and borrowers," she said.For every loan that a bank disburses, some amount of money is required to be set aside as provision. Lower the credit rating of the company, riskier the loan is perceived to be. Thus, the bank is required to set aside more capital for a lower rated company than what it otherwise would do for a higher rated client. New international accounting norms, known as Basel III norms, require banks to maintain higher capital and higher liquidity. They also require a bank to set aside "buffer" capital to meet contingencies. As per the norms, a bank's total capital adequacy ratio should be 12% at any time, in which tier-I, or the core capital, should be at 9%. Capital adequacy is calculated by dividing total capital by risk-weighted assets. If the loans have been given to lower rated companies, risk weight goes up and capital adequacy falls.According to bankers, all loan decisions are now being assessed on the basis of the capital that needs to be set aside as provision against the loan and as a result, loans to lower rated companies are being avoided. According to a senior banker with a public sector bank, the capital adequacy situation is so precarious in some banks that if the risk weight increases a few basis points, the proposal gets cancelled. The banker did not wish to be named. One basis point is one hundredth of a percentage point. Bankers add that the Reserve Bank of India has also started strictly monitoring how banks are utilising their capital. Any big-ticket loan to lower rated companies is being questioned.In this scenario, banks are looking for safe bets, even if it means that profitability is being compromised. "About 25% of our loans this quarter was given to Navratna companies, who pay at base rate. This resulted in contraction of our net interest margin (NIM)," said Bank of India chairperson V.R. Iyer, while discussing the bank's first quarter results with the media. Bank of India's NIM, or the difference between yields on advances and cost of deposits, a key gauge of profitability, fell in the first quarter to 2.45% from 3.07% a year ago, as the bank focused on lending to highly rated customers.Analysts, however, say the strategy being followed by banks is short-sighted. "A high rated client will take loans at base rate and will not give any fee income to a bank. A bank will never be profitable that way. Besides, there are only so many PSU companies to chase. All banks cannot be chasing them all at a time. Fact is, the banks are badly hit by NPA and are afraid to lend now to big projects. They need capital, true, but they have become risk-averse," said a senior analyst with a local brokerage who did not wish to be named.Various estimates suggest that Indian banks would require more than Rs. 2 trillion of additional capital to have this kind of capital adequacy ratio by 2019. The central government, which owns the majority share of these banks, has been cutting down on its commitment to recapitalize the banks. In 2013-14, the government infused Rs. 14,000 crore in its banks. However, in 2014-15, the government will infuse just Rs. 11,200 crore.Which of the following statements is correct according to the passage?
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MCQ-> Governments looking for easy popularity have frequently been tempted into announcing give-aways of all sorts; free electricity, virtually free water, subsidised food, cloth at half price, and so on. The subsidy culture has gone to extremes. The richest farmers in the country get subsidised fertiliser. University education, typically accessed by the wealtier sections, is charged at a fraction of cost. Postal services are subsidised, and so are railway services. Bus fares cannot be raised to economical levels because there will be violent protests, so bus travel is subsidised too. In the past, price control on a variety of items, from steel to cement, meant that industrial consumers of these items got them at less than actual cost, while the losses of the public sector companies that produced them were borne by the taxpayer! A study, done a few years ago, came to the conclusion that subsidies in the Indian economy total as much as 14.5 per cent of gross domestic product. At today's level, that would work out to about Rs. 1,50,000 crore.And who pays the bill? The theory — and the political fiction on the basis of which it is sold to unsuspecting voters — is that subsidies go to the poor, and are paid for by the rich. The fact is that most subsidies go to the ‘rich’ (defined in the Indian context as those who are above the poverty line, and much of the tab goes indirectly to the poor. Because the hefty subsidy bill results in fiscal deficits, which in turn push up rates of inflation — which, as everyone knows, hits the poor the hardest of all. Indeed, that is why taxmen call inflation the most regressive form of taxation.The entire subsidy system is built on the thesis that people cannot help themselves, therefore governments must do so. That people cannot afford to pay for a variety of goods and services, and therefore the government must step in. This thesis has been applied not just in the poor countries but in the rich ones as well; hence the birth of the welfare state in the West, and an almost Utopian social security system; free medical care, food aid, old age security, et al. But with the passage of time, most of the wealthy nations have discovered that their economies cannot sustain this social safety net, which infact reduces the desire among people to pay their own way, and takes away some of the incentive to work. In short, the bill was unaffordable, and their societies were simply not willing to pay. To the regret of many, but because of the laws of economics are harsh, most Western societies have been busy pruning the welfare bill.In India, the lessons of this experience — over several decades, and in many countries — do not seem to have been learnt. Or, they are simply ignored in the pursuit of immediate votes. People who are promised cheap food or clothing do not in most cases look beyond the gift horses — to the question of who picks up the tab The uproar over higher petrol, diesel and cooking gas prices ignored this basic question: if the user of cooking gas does not want to pay for its cost, who should pay? Diesel in the country is subsidised, and if the trucker or owner of a diesel generator does not want to pay for its full cost, who does he or she think should pay the balance of the cost? It is a simple question, nevertheless it remains unasked.The Deve Gowda government has shown some courage in biting the bullet when it comes to the price of petroleum products. But it has been bitten by a much bigger subsidy bug. It wants to offer food at half its cost to everyone below the poverty line, supposedly estimated at some 380 million people. What will be the cost? And, of course, who will pick up the tab? The Andhra Pradesh Government has been bankrupted by selling rice at Rs. 2 per kg. Should the Central Government be bankrupted too, before facing up to the question of what is affordable and what is not? Already, India is perenially short of power because the subsidy on electricity has bankrupted most electricity boards, and made private investment wary unless it gets all manner of state guarantees.Delhi’s subsidised bus fares have bankrupted the Delhi Transport Corporation., whose buses have slowly disappeared from the capital's streets. It is easy to be soft and sentimental, by looking at programmes that will be popular. After all, who doesn't like a free lunch? But the evidence is surely mounting that the lunch isn't free at all. Somebody is paying the bill. And if you want to know who, take a look at the country's poor economic performance over the years.Which of the following should not be subsidised now, according to the passage?
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MCQ-> Read the following passage to answer the given questions based on it. Some words/ phrases are printed in bold to help you locate them while answering some of the questions. “We have always known that heedless self interest was bad morals. We now know that it is bad economies,” said American President Franklin D. Roosevelt in 1937 in the midst of the Great Depression. And the world has learnt that enlightened self-interest is good economics all over again after the Great Recession of 2009. Americans are entering a period of social change as they are recalibrating their sense of what it means to be a citizen, not just through voting or volunteering but also through commerce. There is a new dimension to civic duty that is growing among Americans – the idea that they can serve not only by spending time in communities and classrooms but by spending more responsibly. In short, Americans are beginning to put their money where their ideals are. In a recent poll most said they had consciously supported local or small neighbourhood businesses and 40 percent said that they had purchased a product because they liked the social or political values of the company that produced it. People were alarmed about ‘blood diamonds’ mined in war zones and used to finance conflict in Africa. They were also willing to pay $2000 more for a car that gets 35 miles per gallon than for one that gives less. though the former is more expensive but environment friendly. Of course consumers have done their own doing-well-by doing-good calculation -a more expensive car that gives. better mileage will save them money in the long run and makes them feel good about protecting the environment. Moreover since 1995, the number of socially responsible investment (SRI) mutual funds, which generally avoid buying shares of companies that profit from tobacco, oil or child labour haA grown from 55 to 260. SRI funds now manage approximately 11 percent of all the money invested in the US financial markets -an estimated S 2.7 trillion. This is evidence of a changing mindset in a nation whose most iconic economist Milton Friedman wrote in 1970 that a corporation’s only moral responsibility was to increase shareholder profits.At first the corporate stance was defensive: companies were punished by consumers for unethical behaviour such as discriminatory labour practices. Thu nexus of activist groups. con – sumers and government regulation could not merely tarnish a company but put it out of business. But corporate America quickly discerned that social responsibility attracts investment capital as well as customer loyalty. creating a virtuous circle. Some companies quickly embraced the new ethos that consumers boycotted prod ucts they considered unethical and others purchase products in part because their manufacturers were responsible. With global warming on t he minds oft many consumers lots of companies are racing to ‘outgreen’ each other. The most progressive companies are talking about a triple bottom line-profit, planet and people – that focuses on how to run a business while Irving io improve environmental anti worker conditions. This is a time when the only that has sunk lower than the Arnett can public’s opinion of Congress is its opinion of business, One burning question is how many of these Corporate Social Responsibility (CSR) initiatives are just shrewd marketing to give companies a halo effect? After all only 8 per cent of the large American corporations go through the trouble of verifying their CSR reports. which many consumers don’t bother to read. And while social responsibility is uric way for companies to get back their reputations consumers too need to make ethical choices.Which of the following reparesnts the changc/s that has/ have occurred in the American outlook? (A) The perception that the government needs to invest resources in business rather than in education, (B) Loss of faith in American corporations as they do not dis burse their profits equitably among shareholders. (C) Americans have cut down on their expenditure drastically to invest only in socially ro sponsible mutual funds....