Commerce Exam > Commerce Questions > Directions : In the following questions, a s...
Start Learning for Free
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:
Assertion (A): Debentures saves income tax.
Reason (R): Interest on debenture is tax deductible expenditure.
- a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
- b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
- c)Assertion (A) is true, but Reason (R) is false .
- d)Assertion (A) is false, but Reason (R) is true.
Correct answer is option 'A'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Verified Answer
Directions : In the following questions, a statement of Assertion (A)...
Tax saving bonds enjoy special privileges under Section 80CCF of the Income Tax Act which states that individuals enjoy tax deductions up to Rs 20,000 on the bonds owned by them. This deduction is excluding the Rs 1.5 lakh provided under Section 80C of the Act.
View all questions of this test
Most Upvoted Answer
Directions : In the following questions, a statement of Assertion (A)...
Assertion (A): Debentures save income tax.
Reason (R): Interest on debenture is tax deductible expenditure.
The correct answer is option 'A', which states that both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
Explanation:
Debentures are long-term debt instruments issued by companies to raise funds from the public. They offer fixed interest payments to debenture holders and are considered as a safe investment option. Let's analyze both the assertion and the reason in detail.
Assertion (A): Debentures save income tax.
Debentures can help individuals save income tax, especially if they fall under a higher tax bracket. By investing in debentures, individuals can claim tax deductions on the interest paid on these instruments. This reduces their taxable income and consequently reduces the income tax liability. Therefore, the assertion is true.
Reason (R): Interest on debenture is tax deductible expenditure.
The reason provided states that the interest on debentures is tax deductible expenditure. This means that the interest paid by the company on debentures is considered as an expense and can be deducted from the company's taxable income. This reduces the company's tax liability. Therefore, the reason is true.
Explanation of the Relationship:
The reason provided serves as a correct explanation for the assertion. When individuals invest in debentures, they receive interest payments from the company. These interest payments are taxable in the hands of the individuals. However, the individuals can claim a deduction for the interest paid on the debentures, which reduces their taxable income and consequently saves income tax. Similarly, for the company issuing the debentures, the interest paid on the debentures is considered as an expense and can be deducted from its taxable income, thereby reducing the company's tax liability. Hence, the reason clearly explains why debentures save income tax.
To summarize, debentures save income tax for individuals by allowing them to claim deductions on the interest paid, and the interest on debentures is tax deductible expenditure for companies. Therefore, both the assertion and the reason are true, and the reason correctly explains the assertion.
Reason (R): Interest on debenture is tax deductible expenditure.
The correct answer is option 'A', which states that both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
Explanation:
Debentures are long-term debt instruments issued by companies to raise funds from the public. They offer fixed interest payments to debenture holders and are considered as a safe investment option. Let's analyze both the assertion and the reason in detail.
Assertion (A): Debentures save income tax.
Debentures can help individuals save income tax, especially if they fall under a higher tax bracket. By investing in debentures, individuals can claim tax deductions on the interest paid on these instruments. This reduces their taxable income and consequently reduces the income tax liability. Therefore, the assertion is true.
Reason (R): Interest on debenture is tax deductible expenditure.
The reason provided states that the interest on debentures is tax deductible expenditure. This means that the interest paid by the company on debentures is considered as an expense and can be deducted from the company's taxable income. This reduces the company's tax liability. Therefore, the reason is true.
Explanation of the Relationship:
The reason provided serves as a correct explanation for the assertion. When individuals invest in debentures, they receive interest payments from the company. These interest payments are taxable in the hands of the individuals. However, the individuals can claim a deduction for the interest paid on the debentures, which reduces their taxable income and consequently saves income tax. Similarly, for the company issuing the debentures, the interest paid on the debentures is considered as an expense and can be deducted from its taxable income, thereby reducing the company's tax liability. Hence, the reason clearly explains why debentures save income tax.
To summarize, debentures save income tax for individuals by allowing them to claim deductions on the interest paid, and the interest on debentures is tax deductible expenditure for companies. Therefore, both the assertion and the reason are true, and the reason correctly explains the assertion.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?
Question Description
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?.
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?.
Solutions for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer?, a detailed solution for Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:Assertion (A): Debentures saves income tax.Reason (R): Interest on debenture is tax deductible expenditure.a)Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).b)Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).c)Assertion (A) is true, but Reason (R) is false .d)Assertion (A) is false, but Reason (R) is true.Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup