HPPSC Post Graduate Teacher Commerce Exam 2020 Solved Paper with Explanation

HPPSC Post Graduate Teacher Commerce Exam Solved Paper

The HPPSC Post Graduate Teacher Commerce Exam Solved Paper is an essential resource for candidates preparing for teaching positions in the subject of commerce. This solved paper includes detailed solutions to questions from previous exams, offering candidates insights into the exam pattern, question styles, and important topics. By thoroughly reviewing this paper, aspirants can identify areas requiring more focus, gain a deeper understanding of complex concepts, and improve their chances of success.

HPPSC Post Graduate Teacher Commerce Exam Solved Paper

The HPPSC Post Graduate Teacher (PGT) Commerce Exam Solved Paper is structured to align closely with the exam’s standards, making it an invaluable tool for refining study techniques and enhancing exam readiness. With comprehensive explanations for each question, this solved paper allows candidates to approach their preparation strategically, whether they are conducting an in-depth study or revising key topics at the last minute. This resource builds confidence and equips candidates to excel in their teaching career ambitions.

HPPSC Post Graduate Teacher Commerce Exam Solved Paper

➤ In India, the GST is a dual model of:

• UK
• Canada
• USA
• Japan

In India, the Goods and Services Tax (GST) follows a dual model, which is based on the Canadian model. It involves both central and state governments in the collection of tax.

➤ GST is a consumption of goods and service tax based on:

• Development
• Dividend
• Destination
• Duration

GST is a consumption-based tax that follows the destination principle, meaning tax is levied at the point of consumption rather than production.

➤ Which code is used to classify goods and services under GST?

• HMN Code
• SAC/HSN Code
• Both a and b
• None of these

Goods and services under GST are classified using the SAC (Services Accounting Code) for services and HSN (Harmonized System of Nomenclature) Code for goods.

➤ From the following options which one will you select for an individual who is said to be resident in India?

• He has a house in India
• He is in India in the previous year for a period of 182 days or more in a fiscal year.
• He is in India for a period of 30 days or more during the previous year and for 365 or more days during 4 previous years immediately preceding the relevant previous year
• His parents are Indian citizens

To be considered a resident of India, an individual must be present in India for at least 182 days during the previous financial year or 60 days during the current year and 365 days during the 4 years preceding the current year.

➤ Which of the following is an agricultural income?

• Dividend paid by a company out of its agricultural income.
• Share of Profit of a Partner from a firm engaged in agricultural operation
• Income from the supply of water by an assessee from a tank in its agricultural land.
• Interest received by a money lender in the form of agricultural produce.

Agricultural income includes profits from farming operations, such as the share of profit from a firm engaged in agricultural activities.

➤ Taxable value of perquisite being sweat equity shares allotted by the employer is:

• The fair market value of such shares as on the date when such option is exercised by the employee as reduced by the amount paid.
• Rent or revenue derived from land which is situated in India and is used for agricultural purposes.
• Fair market value subject to standard deduction of 50000
• Not taxable in the hands of the employee.

The taxable value of sweat equity shares is determined based on their fair market value on the date of exercise of the option, minus the amount paid by the employee for the shares.

➤ Loss from derivative trading is:

• Short-term Capital Loss
• Speculative business loss
• Non-speculative business loss
• Loss under the head ‘Income from Other Sources’

Loss from derivative trading is categorized as a non-speculative business loss because it is considered part of regular business operations.

➤ Unabsorbed depreciation can be carried forward for:

• Any number of years
• 8 years
• 4 years
• 7 years

Unabsorbed depreciation can be carried forward indefinitely until it is fully utilized, providing flexibility in offsetting it against future profits.

➤ At what rate is tax deducted from payment made to a resident on winning from a lottery?

• 30%
• 30% + Surcharge + HEC
• 30% + HEC
• 31%

The tax rate on lottery winnings is 30%, which is deducted at source. Additional charges like surcharge and health and education cess may apply based on the total income.

➤ Which ITR form number is to be used for filing the return of income by an individual having business income?

• Form No. 1
• Form No. 2
• Form No. 5
• Form No. 3

Individuals with business income should use Form No. 3 for filing their income tax return, as it accommodates details required for business income reporting.

➤ A Zero coupon bond is a long-term capital asset if it is held for more than ………. months before transfer.

• 6 months
• 12 months
• 8 months
• None of these

Zero coupon bonds qualify as long-term capital assets if held for more than 12 months before transfer, allowing for favorable tax treatment on long-term capital gains.

➤ The maximum amount deductible u/s 80 TTA in respect of interest on savings bank account is:

• 10,000
• 20,000
• 50,000
• 100,000

Under section 80 TTA, an individual can claim a maximum deduction of ₹10,000 for interest earned on savings bank accounts.

➤ Which of the following dates marks the end of the period covered by AS-4?

• On 2 May 2013 the draft financial statement ready for issue to the accounts committee
• On 9 May 2013 accounts committee approves the financial statement
• On 15^th May 2013 board of directors approves the financial statement.
• On 30 May 2013, shareholders approve the financial statements

AS-4 deals with events occurring after the balance sheet date. The end of the period covered is marked by the approval of financial statements by the board of directors.

➤ Start-up cost, training cost, and cost of reallocating should be accounted for as:

• Deferred revenue expenditure
• Expenses
• Intangible assets
• Liability

Start-up costs, training costs, and costs related to reallocating resources are typically considered expenses and are accounted for in the profit and loss statement.

➤ Employee stock options can be offered by a public company by passing:

• A special resolution in a general meeting
• An ordinary resolution in a general meeting
• A resolution in the board meeting
• No resolution required

Public companies must pass a special resolution in a general meeting to offer employee stock options, as it requires approval from shareholders.

➤ A company granted 4000 options to employees and director on 1 April 2013 at Rs. 150 when the market price was Rs. 300. Vesting period is 3 years. What is the value of Option

• 50,000
• 60,000
• 6,00,000
• 55,000

The value of an option is calculated as (Market Price – Exercise Price) * Number of Options. Here, it is (300 – 150) * 4000 = 6,00,000.

➤ The buy-back of equity shares in any financial year should not exceed

• 20% of the total paid-up equity share capital in that financial year
• 25% of the total paid-up equity share capital in that financial year
• 25% of the total called up equity share capital in that financial year
• 20% of the total paid up equity share capital plus free reserve of the company

The maximum limit for buy-back of equity shares in a financial year is 25% of the total paid-up equity share capital in that financial year.

➤ The acquisition of an enterprise by issue of shares will

• Be shown in the cash flow statement under investing activities
• Not be shown in the cash flow statement
• Are treated as cash flow from financial activity
• All of the above

Acquisition of an enterprise by issuing shares is not shown in the cash flow statement, as it does not involve cash flow directly.

➤ Royalty revenue should be recognized

• On an accrual basis in accordance with the terms of the relevant agreement
• Cash basis
• On actual basis
• None of the above

Royalty revenue should be recognized on an accrual basis, which matches the revenue to the period in which it is earned, as per the terms of the relevant agreement.

➤ In which of the following cases, income of previous year is assessable in the previous year itself

• Assessment of persons leaving India
• A person in employment in India
• A person who is into illegal business
• A person who is running a charitable institution

Income of a person leaving India is assessable in the previous year itself to ensure proper taxation before their departure.

➤ For availing exemption under section 54, which amount is eligible for availing exemption?

• The taxpayer (i.e., Seller) needs to be an individual or HUF.
• Asset needs to be classified as a long-term capital asset.
• The seller should purchase a residential house either 1 year before the date of sale/transfer or 2 years after the date of sale/transfer
• All of the above

To avail exemption under section 54, the seller must be an individual or HUF, the asset must be a long-term capital asset, and the residential house must be purchased within the specified time frame.

➤ Which of the following is not an income taxable as income from other sources?

• Family pension
• Casual income
• Director’s sitting fee for attending board meetings
• Rent received for house property including use of plant and machinery, where rent is separable between rent for use of plant and machinery

Rent received for house property, including the use of plant and machinery, is typically not considered as income from other sources if the rent is separable.

➤ Who is the Chairman of GST Council 2019?

• Prime Minister
• Corporate Affair minister
• Union Finance Minister
• President of India

The Chairman of the GST Council in 2019 was the Union Finance Minister.

➤ Service tax was introduced in India in the year.

• 1993
• 1995
• 2004
• 1994

Service tax was introduced in India in 1994.

➤ After which error will a trial balance still balance

• Wages paid Rs. 20,000 was entered correctly in the bank account but debited to the wage account Rs. 25,000
• Rent received Rs. 50,000 was debited to the rent payable account
• The sales day book was under cast by Rs. 20,000
• Goods returned to supplier Rs. 150 were entered in purchase returns day book as Rs. 105

A trial balance will still balance if there is an error where goods returned are recorded incorrectly but the same amount is adjusted in both the debit and credit sides.

➤ Which lake is situated near the Chanshal Peak (Rohru)?

• Tanu Jubbal
• Chandranahan
• Katasan
• Karali

Chandranahan Lake is situated near Chanshal Peak (Rohru).

➤ Which of the following is a tributary of the Chenab river?

• Miyar
• Baner
• Harla
• Awa

The Miyar river is a tributary of the Chenab river.

➤ Which pass joins Lahaul and Bharmour?

• Borsa
• Kugti
• Makori
• Jalori

The Kugti Pass connects Lahaul and Bharmour.

➤ In which district of H.P. is Gemur monastery?

• Chamba
• Kullu
• Kinnaur
• Lahaul-Spiti

Gemur Monastery is located in the Lahaul-Spiti district of Himachal Pradesh.

➤ Tirthan sanctuary is near ………?

• Banjar
• Dalhousie
• Paonta Sahib
• Solan

Tirthan Sanctuary is located near Banjar in Himachal Pradesh.

➤ At which place in Mandi district of H.P. there is a Sheep Breeding Farm?

• Bhangrotu
• Chauntra
• Paddhar
• Nagwain

The Sheep Breeding Farm in Mandi district is located at Nagwain, which is known for its efforts in sheep breeding and improving wool quality.

➤ For which game/sport did Pooja Thakur of Bilaspur get Parshuram Award?

• Athletics
• Hockey
• Kabaddi
• Shooting

Pooja Thakur received the Parshuram Award for her achievements in Kabaddi, highlighting her significant contributions to the sport.

➤ Near which place in Kangra District of H.P. is Chinmaya Sandeepani Himalaya Ashram?

• Yol Camp
• Baijnath
• Nurpur
• Shahpur

The Chinmaya Sandeepani Himalaya Ashram is situated near Yol Camp, which is known for its serene environment suitable for spiritual activities.

➤ Which Raja of Chamba received Knighthood in 1906?

• Sham Singh
• Gopal Singh
• Umed Singh
• Bhuri Singh

Raja Bhuri Singh of Chamba was honored with Knighthood in 1906 for his contributions and services to the British administration.

➤ Who was the speaker of H.P. Vidhan Sabha in 1963?

• Tapinder Singh
• Des Raj Mahajan
• Vidya Dhar
• Drishan Chander

Des Raj Mahajan served as the Speaker of the Himachal Pradesh Vidhan Sabha in 1963, playing a crucial role in legislative proceedings.

➤ In which state of India is Karbi tribe mainly found?

• Assam
• Bihar
• Nagaland
• Manipur

The Karbi tribe is predominantly found in Assam, where they have a significant cultural presence and contribute to the region’s diversity.

➤ When was National Cadet Corps (NCC) established?

• 1948
• 1952
• 1955
• 1956

The National Cadet Corps (NCC) was established in 1948 to foster discipline, leadership, and a sense of patriotism among the youth.

➤ What was the original name of epic Mahabharata?

• Raj Katha
• Bharat Katha
• Jai (Jaya) Samhita
• Pandor Samhita

The epic Mahabharata was originally known as Jai (Jaya) Samhita, which signifies the victory and greatness of the story.

➤ Which day is observed as World Day for water?

• February 15
• March 22
• April 10
• May 21

World Water Day is observed on March 22 each year to raise awareness about the importance of freshwater and advocate for sustainable management of water resources.

➤ By which amendment was Dogri added in the 8^th schedule of Indian Constitution?

• 84^th
• 88^th
• 92^nd
• 96^th

Dogri was added to the 8^th schedule of the Indian Constitution by the 92^nd Amendment Act, recognizing it as a scheduled language.

➤ Abiy Ahmed won the 2019 Nobel prize for peace for ending Ethiopia’s border dispute with:

• Sudan
• Eritrea
• Somalia
• Yemen

Abiy Ahmed received the Nobel Peace Prize in 2019 for his efforts in resolving the long-standing border conflict between Ethiopia and Eritrea, which significantly improved relations between the two countries.

➤ In which country is Tripoli?

• Liberia
• Lesotho
• Libya
• Lithuania

Tripoli is the capital and largest city of Libya, located in North Africa along the Mediterranean coast.

➤ Who discovered the law of gravitation and motion?

• Einstein
• Ohm
• Hertz
• Newton

Sir Isaac Newton formulated the laws of gravitation and motion, which laid the foundation for classical mechanics and explained the fundamental principles governing the movement of objects.

➤ Which is the largest planet?

• Neptune
• Jupiter
• Saturn
• Mars

Jupiter is the largest planet in our solar system, known for its massive size and prominent features such as the Great Red Spot.

➤ Near which river is Surkotara Indus Valley civilization site?

• Bhabar
• Pabbar
• Ghaggar
• Bhogwa

The Surkotara site of the Indus Valley civilization is located near the Ghaggar River, which was an important river in ancient times.

➤ The term Opportunity Cost refers to

• Variable Cost
• Short-run cost
• The cost forgone in favour of production of another product
• Cost related to an optimum level of production

Opportunity Cost represents the value of the next best alternative that is forgone when a decision is made to allocate resources to a particular product or activity.

➤ Which of the following is not an accounting software package

• QuickBooks
• SAGE One
• SAGE M
• SAGE 50

SAGE M is not a recognized accounting software package, whereas QuickBooks, SAGE One, and SAGE 50 are popular accounting software products.

➤ UNCTAD stands for

• United Nations Committee on Tariff and Development
• United Nations Conference on Trade and Deficit
• United Nations Conference on Trade and Development
• United Nations Cause for Trade and Development

UNCTAD stands for the United Nations Conference on Trade and Development, which focuses on trade, investment, and development issues.

➤ Stock and debtor system is generally used when goods are sent to the branch at

• Cost Price
• An invoice price
• Market Price
• None of these

The stock and debtor system is commonly used when goods are sent to a branch at an invoice price, allowing for accurate tracking of inventory and receivables.

➤ Goods in transit are shown in the balance sheet of

• Branch
• Head Office
• None of these
• Both Head and Branch Office

Goods in transit are typically shown in the balance sheet of the Head Office, reflecting their value before they are received at the branch.

➤ The Receipts and Payments Account is merely a summary of

• Cash Transactions
• Credit Transactions
• None of these
• Under Installment Payment System

The Receipts and Payments Account provides a summary of cash transactions over a period, including all receipts and payments made.

➤ Under Installment Payment System:

• The title of goods is passed on to the buyer immediately at the time of signing the agreement
• The title of goods is passed on to the buyer after the payment of the final installment
• Does not pass to buyer
• None of these

Under the Installment Payment System, the title of goods is transferred to the buyer immediately upon signing the agreement, even though payment is made in installments.

➤ Cum dividend quotation of share means that the quotation includes

• Dividend to be declared in future
• Dividend declared recently but not paid
• Does not pass to buyer
• None of these

A cum dividend quotation includes the dividend that is expected to be declared in the future, reflecting the potential future return to the shareholder.

➤ The dissolution of a partnership

• Leads to the discontinuance of business
• Will lead to realization of assets
• Both a and b
• None of these

The dissolution of a partnership does not necessarily lead to the discontinuance of business or realization of assets; it primarily involves the formal end of the partnership agreement.

➤ Under Hire Purchase System, depreciation is charged on

• Cash Price
• Market Price
• Sale Value of Asset
• None of these

Under the Hire Purchase System, depreciation is charged on the cash price of the asset, reflecting its value from the time of acquisition.

➤ When the expenses of liquidation are to be borne by the purchasing company then it debits

• Goodwill account
• Realization account
• Cash account
• None of these

The purchasing company will debit the Goodwill account to cover liquidation expenses.

➤ Which method is known as dual method of share valuation

• Yield method
• Fair value method
• Price earning ratio
• Growth Model

The Fair Value method is known as the dual method of share valuation.

➤ Subsidiary books are also called as

• Books of original entry
• Cash flow statement
• Income statement
• All of these

Subsidiary books are referred to as Books of original entry.

➤ Which of the following varies with the quantity purchased

• Cash discount
• Trade discount
• Both a and b
• None of these

Trade discount varies with the quantity purchased.

➤ Current Assets of a company are worth Rs. 45000. Current ratio 2.5:1. What would be the amount of current liabilities?

• 18000
• 10000
• 9000
• 36000

The amount of current liabilities is calculated as Rs. 18000.

➤ In the light of AS-17, reportable segments are those in which total revenue from external sales and inter segment sales is

• Equal to or more than 5% of the total revenue of all the segments
• Equal to or more than 10% of the total revenue of all the segments
• Equal to or more than 15% of the total revenue of all the segments
• Equal to or more than 20% of the total revenue of all the segments

According to AS-17, reportable segments are those where the total revenue from external and inter-segment sales is 10% or more of the total revenue of all segments.

➤ In an operating lease, the lessee should recognize the benefit of incentives as

• Reduction of rental expenses over the lease term on a straight-line basis
• Reduction of rental expenses over the lease term on a proportionate basis
• No recognition should be made
• None of these

In an operating lease, benefits from incentives should be recognized as a reduction of rental expenses over the lease term on a straight-line basis.

➤ Which of the following is an accounting system of paying out and subsequently replenishing petty cash?

• Imprest system
• Double entry system
• Reimbursement system
• All of these

The Imprest system is used for managing petty cash through payment and subsequent replenishment.

➤ If the buyer fails to pay any installment then the seller has the right to repossession of goods under

• Installment payment system
• Hire Purchase System
• Both Installment and hire purchase system
• None of these

Under the Hire Purchase System, the seller has the right to repossess goods if the buyer fails to make any installment payments.

➤ The relationship between Consignor and Consignee is that of a

• Partners of a firm
• Principal and agents
• Deputy Manager and Assistant manager
• None of the above

The relationship between Consignor and Consignee is that of Principal and Agent.

➤ Family pension received by a widow of a member of the armed forces where the death of the member has occurred in the course of operational duties is

• Exempt up to Rs 300,000
• Totally exempted
• Exempted up to Rs 350,000
• Totally chargeable to tax

Family pension received by a widow of an armed forces member who died in operational duties is totally exempt from tax.

➤ Which among the following is an example of capital expenditure?

• Premium paid for a lease
• Legal expenses incurred in the purchase of land
• Legal expenses incurred in raising a debenture loan
• All of the above

Premium paid for a lease is an example of capital expenditure.

➤ Which among the following is a body set up under the Companies Act, 2013?

• National Financial Reporting Authority
• National Advisory Committee on Accounting Standards
• Accounting Standard Board
• None of the above

The National Financial Reporting Authority is a body established under the Companies Act, 2013.

➤ Accounting is a

• Social science
• Physical science
• Biological science
• None of these

Accounting is considered a social science.

➤ In the event of dissolution of a firm

• Assets are realized and liabilities are paid off
• Assets and liabilities are revalued
• New balance sheet is drawn
• None of the above

During the dissolution of a firm, assets are realized and liabilities are paid off.

➤ Which of the following comes under efficiency ratios?

• Working capital Turnover ratio
• Inventory turnover ratio
• Fixed assets turnover ratio
• All of the above

All of the listed ratios fall under efficiency ratios.

➤ Assertion (A): Mark-up pricing is a method of determining price.

Reason (R): P = ATC + (m x ATC) is the expression for that.

• A is correct but R is not correct.
• Both A and R are correct.
• Both A and R are not correct.
• R is correct, but A is not correct.

Both Assertion (A) and Reason (R) are correct, and R is the correct explanation of A.

➤ Assertion (A): Marginal cost and differential cost do not convey the same meaning in all circumstances.

Reason (R): Differential cost increases or decreases due to change in fixed cost.

• A is true but R is false.
• A is false but R is true.
• A and R are correct and R is the correct explanation of A.
• Both A and R are correct, but R is not the correct explanation of A.

A and R are correct, and R is the correct explanation of A.

➤ Which one is more appropriate for cost of retained earnings?

• Weighted Average Cost of Capital
• Opportunity cost to the firm
• Expected rate of return by the investor
• None of these

The opportunity cost to the firm is a more appropriate measure for the cost of retained earnings.

➤ Which of the following is not included in the term income under Income Tax Act, 1961?

• Profit in lieu of salary
• Reimbursement of travelling expenses
• Profit and gains of business or profession
• Dividend

Profit in lieu of salary is not included in the term income under the Income Tax Act, 1961.

➤ Interest from public Provident Fund investment

• Taxable under the head income from other sources
• Taxable under the head income from business and profession
• Exempted income
• Allowed as deduction

Interest from public Provident Fund investment is exempted income.

➤ Transport allowance for commuting from place of residence to place of duty for an employee who is physically challenged such as blind/deaf/dumb or orthopaedically handicapped with disability of lower extremities exempted up to

• 3200
• 3000
• 2800
• 2400

The transport allowance for such employees is exempted up to Rs. 3200.

➤ PAN contains ……….. Alphabets

• 5
• 6
• 10
• 8

PAN contains 6 alphabets.

➤ ITR full form is

• Income Tax rules
• Income Tax return
• Income tax rectification
• None of these

ITR stands for Income Tax return.

➤ What is true for income tax slabs for resident individual above 80 years of age (Super Senior Citizen) for the assessment year 2019-20?

• Upto 3 Lakh Nil
• 3,00,001 to Rs. 5,00,000 5% of (Total income minus Rs. 3,00,000) + 4% cess
• For income between Rs 5,00,001 to Rs. 10,00,000 tax rate is 20% of the total income that is more than Rs. 5 lakh + 4% cess
• Upto 6 lakh nil

For income between Rs 5,00,001 to Rs. 10,00,000, the tax rate is 20% of the total income that is more than Rs. 5 lakh plus 4% cess.

➤ What are the different classes of digital signature certificates?

• Class 1 certificate
• Class 2 certificate
• Class 3 certificate
• All of these

There are three classes of digital signature certificates: Class 1, Class 2, and Class 3.

➤ Which of the following is a taxable supply under GST Act?

• Transportation of deceased person through a hired vehicle
• Gift of office laptop by an employer to its employee on which ITC availed
• A new laptop worth Rs. 45,000/- gifted by an employer to its employee
• Fines/penalty/LD paid by a contractor to Govt. for delay/non-performance of contract

The gift of an office laptop by an employer to its employee, on which Input Tax Credit (ITC) was availed, is a taxable supply under GST Act.

➤ Which constitutional amendment is done to pass the GST bill?

• 101 amendment
• 110 amendment
• 120 amendment
• 115 amendment

The GST bill was passed through the 101st constitutional amendment.

➤ A Special Audit under GST is conducted by

• Commissioner of GST
• Joint commissioner with prior approval of CBIC
• Chartered Accountant/Cost Accountant
• All of the above

A Special Audit under GST is conducted by Chartered Accountant or Cost Accountant.

➤ GST was implemented in India from

• 1^st January 2017
• 1^st April 2017
• 1^st March 2017
• 1^st July 2017

GST was implemented in India from 1^st July 2017.