Practice Test

Q1) At the balance sheet date, the balance in the ‘initial margin equity index futures account’ should be shown separately under the head_______ Show Answer

Q2) What kind of account is required by a nominee to give effect to the transmission of shares? Show Answer

Q3) All the orders entered on the trading system of a derivative exchange are at prices exclusive of brokerage. Show Answer

Q4) Securities transaction tax is levied on _____. Show Answer

Q5) Mr. Mohit buys 3 call options of strike price 200 when the spot price was 190 at a premium of Rs.16. will he have to pay STT? Show Answer

Q6) STT means – Show Answer

Q7) A tax which is clearly mentioned in the Contract Note is ______. Show Answer

Q8) In the balance sheet, "Equity Index/ Stock Option Margin Account" account should be shown separately under the head ____________. Show Answer

Q9) Payment made or received by the seller/ writer for the margin would be credited/ debited to the bank account and the corresponding debit or credit for the same should be made to _________________. Show Answer

Q10) The buyer/ holder of option will recognize premium as an expense in the profit and loss account. Show Answer

Q11) As per Accounting Standards, the initial margin paid by an option seller is shown under ______ in the Balance sheet. Show Answer

Q12) Loss incurred on derivatives transactions can be carried forward for a period of 12 assessment years. Show Answer

Q13) In the books of the buyer of the option, the premium paid would be ______. Show Answer

Q14) On the Balance Sheet, the balance in the initial margin equity index account should be shown separately under the head ______. Show Answer

Q15) Value of taxable securities transaction relating to an option in securities shall be the option premium, in case of sale of an option in securities. Show Answer

Q16) Income or loss on derivative transactions which are carried out in a recognized stock exchange ____________. Show Answer

Q17) STT is applicable on all _______ transactions for both futures & options contract. Show Answer

Q18) Accounting for open options as on the Balance Sheet date is shown under the “Equity Index/Stock Option Premium Account”. Show Answer

Q19) At the year-end, any balance in the "Deposit for Mark-to-Market Margin Account" should be shown as a deposit under the head _____________. Show Answer

Q20) At the expiry of a series of equity index futures, the profit/ loss, on final settlement of the contracts in the series, should be calculated as the difference between final settlement price and contract prices of all the contracts in the series. Show Answer

Q21) Which of the following should be disclosed separately for long and short positions, in respect of each series of equity index futures as of the balance sheet date? Show Answer

Q22) ________ being anticipated profits should be ignored & no credit for the same should be taken in the profit & loss account. Show Answer

Q23) On exercise of an option the buyer/ holder of an option will recognize the option premium as _______. Show Answer

Q24) In the accounting system of open options as on Balance Sheet day, “Provision for loss on equity index/ stock option account” is shown as deduction from “equity index/ stock option account” which is shown under ______. Show Answer

Q25) At the year-end, any balance in the ”Deposit for Mark-To-Market Margin Account” should be shown as a deposit under the head “current assets”. Show Answer

Q26) When forward contract is for hedging, the premium or discount (difference between the value at spot rate and forward rate) should be amortized __________. Show Answer

Q27) When forward contract is for hedging, Profit/ loss on cancellation/ renewal of forward contract are recognized in ________ Account. Show Answer

Q28) When forward contract is for trading/ speculation, No premium or discount is recognized. Show Answer

Q29) At the time when the contract is entered into for purchase/ sale of equity index futures, no entry is passed for recording the contract because no payment is made at that time except for the initial margin. Show Answer

Q30) At the balance sheet date, the balance in the "Initial Margin - Equity Index/ Equity Stock Futures Account' should be shown separately under the head _________. Show Answer