Pass4sure AAFM GLO_CWM_LVL_1 Dumps

Sample Questions

GLO_CWM_LVL_1 Sample Question 1

You want to take a trip overseas which costs Rs. 10 lacs. The cost is expected to remain unchanged in nominal terms. You can save annually Rs. 50000 to fulfill the desire. How long will you have to wait if your savings earn an interest rate of 12%?

A. 10.79 years  
B. 11.00 years 
C. 11.23 years 
D. 10.99 years 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 2

What is the surrender value, if the sum assured is Rs. 100,000/-, DOC is 01/01/1997, endowment with profit 25 years, due date of last premium paid 01/01/2010. Premium to be paid semi-annually. Accrued bonus is 500 per thousand of SA. Surrender value factor is 19% ?

A. 23750 
B. 21565
 C. 15010 
D. 12825

ANSWER : C

GLO_CWM_LVL_1 Sample Question 3

Which one of the following statements is/are correct?

A. (i) only
B. (ii) only
C. Both are correct
D. Both are incorrect

ANSWER : C

GLO_CWM_LVL_1 Sample Question 4

Pushkar completed the construction of a house property on 14.8.2008 with borrowed capital of Rs.800000 @ 12%. The loan was taken on 1.4.2006 and is still outstanding. The house was used for his own residence during the entire FY 10-11. Deduction U/S 24(B) for interest on borrowed capital for FY shall be

A. 150000 
B. 30000
 C. 96000 
D. 134400 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 5

Shweta joins a private limited company covered under the PF Act. The employer contributes for all employees up to the specified salary limit. Her monthly salary consists of Rs. 10000 as basic, Rs. 5000 as DA and 10% of the basic as HRA. What would be the deduction from her monthly salary towards the statutory PF benefits?

A. Rs. 780 
B. Rs. 1200 
C. Rs. 1800 
D. Rs. 1920 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 6

Your client, a businessman has a house worth Rs. 2.1 crore and a farm house worth Rs. 85 lakh. His business is worth Rs. 10 crore as per last balance sheet. He has two other partners in the business having stakes of 24% each. He has two cars purchased at Rs. 40 lakh and Rs. 20 lakh, the latter being in personal account. The cars have depreciated/market value at Rs. 30 lakh and Rs. 8 lakh, respectively. His joint Demat account, wife being primary holder, has stocks worth Rs. 1.65 crore. The business has taken Keymans insurance on his life of value Rs. 1.5 crore. He has himself insured his life for an assured sum of Rs. 1.5 crore. You evaluate your client’s estate in case of any exigency with his life as _____. 

A. Rs. 8.20 crore 
B. Rs. 9.56 crore
 C. Rs. 10.51 crore 
D. Rs. 5.73 crore 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 7

A. Rs 17967
B. Rs 18103
C. Rs 19800
D. Rs 17500

ANSWER : A

GLO_CWM_LVL_1 Sample Question 8

If a scheme has 45 cr units issued and has a Face Value of Rs. 10 and NAV is at 11.13, unit capital (Rs. Cr) would be equal to

A. 500.85 
B. 50.85 
C. 950.85 
D. 450 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 9

What is the portfolios standard deviation if you put 25% of your money into stock A which has a standard deviation of 15% and rest into stocks B which has a standard deviation of 10%. The correlation coefficient between the returns of the stocks is .75.?

A. 11.25% 
B. 10.60% 
C. 12.40%
 D. 15.00% 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 10

Choose the amount of final tax liability of R for the assessment year 2007-08:

A. 17100
B. 17442
C. 15700
D. 16014

ANSWER : B

GLO_CWM_LVL_1 Sample Question 11

Samantha celebrated her 21st birthday today, her father gave her Rs. 6,25,000/- which is deposited in a account that pays a ROI of 12.25% p.a. compounded monthly. If she wants to withdraw Rs. 7,50,000 on her 31st. Birthday and balance on her 41stBirthday. How much can she withdraw on her 41st. birthday.?

A. 2114431 
B. 1364431 
C. 4615995 
D. 4333264 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 12

Mr. Raja Ram is working as a regional head in a Pharmaceutical Company. He has a annual income of Rs. 10,00,000. He will be retiring in next ten years. His current expenses are Rs. 5,00,000. The inflation rate for the foreseeable future is expected to be 5%. He assumes that his post retirement expenses will be 70% of his last year expenses of his service and they will increase at inflation rate and paid at the beginning of each year. On his retirement He plans to leave his current rented apartment and shift into a spacious and airy bungalow located on the suburbs of the city (his long cherished dream). The current price of the bungalow is Rs. 24 lakh which is estimated to increase in line with inflation rate. A ten year government security paper fetches 10% interest rate, which will remain constant for the forthcoming period. He is in good health and expects to live for twenty years after retirement. As a CWM® you are required to calculate the amount he needs to save at the end of ten years on an annual basis so that he can pay his post retirement expenses as well as buy his dream house.

A. 4.67 lacs 
B. 7.219 lacs 
C. 7.56 lacs 
D. 6.56 lacs 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 13

Amit an industrialist wants to buy a flat in a housing society presently costing Rs. 35,00,000/- after 6 years. The cost of the house is expected to increase by 15% pea for the first 3 years and by 10% in the remaining years. Amit wants to start a SIP with monthly contributions in Birla Front Line Equity Mutual Fund to pay for the down payment of the house which would be 25% of the house value at that time. You as a CWM expect that the fund would give ROI of 14% p.a. compounded monthly in the next 10 years. Please advise Amit the monthly SIP amount starting at the beginning of every month for the next 6 years to fulfill his goal of buying the Flat he desires. 

A. 63422.72 
B. 65185.55 
C. 16537.56 
D. 15883.32 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 14

Mr. Reddy is 58 years old and has just retired from his company,and have a total retirement benefits of Rs. 29,37,500/-. His life expectancy is 75 years. He has a dream to take a world-trip after 2 years from now with an estimated current price of Rs. 4,00,000/-. He has finalized a flat of Rs. 15,00,000/- for immediate purchase. Calculate how long his corpus will run if his post retirement living expenses in the beginning of every year is Rs. 1,35,000/- considering inflation @ 4% and rate of return is 6% p.a.? 

A. 12.65 
B. 8.22 
C. 11.34 
D. 12.22

ANSWER : B

GLO_CWM_LVL_1 Sample Question 15

A businessman sold Rs. 85 lakh value of unlisted securities on 20th December 2012. These shares were acquired in April 2008 for Rs. 20 lakh. He invested Rs. 40 lakh from these proceeds in February 2013 in his first residential house to avail benefit under Section 54F of the Income-tax Act, 1961. What approximate amount of bonds specified under Section 54EC should he purchase and by what date so as to make his capital gains liability almost “Nil” towards these transactions? Cost inflation index for FY 2008-09: 582, 2012-13: 852.

A. Rs. 26.23 lakh, 19th June 2013 
B. Rs. 15.73 lakh, 30th July 2013 
C. Rs. 27.01 lakh, 30th July 2013 
D. Rs. 29.50 lakh, 19th June 2013 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 16

The correlation coefficient between returns on stock of M/s X Ltd and the market returns is 0.3. The variance of returns on M/s X Ltd. is 225(%)2 and that for the market returns is 100(%)2 . The risk-free rate of return is 5% and the market return is 15%. The last paid dividend is Rs. 2 and the current purchase price is Rs. 30. The growth rate for the company is 10%. The required rate of return on the security as per the Capital Asset Pricing Model is: 

A. 10% 
B. 11.30%
 C. 9.50% 
D. 12.50% 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 17

Vikash owns a piece of land situated in Delhi ( Date of acquisition : March 1, 1983, Cost of acquisition Rs. 20,000/- value adopted by Stamp duty authority at the time of purchase Rs. 45,000/-) On March 30, 2012 the piece of land is transferred for 4 lakh. Find out the capital gains chargeable to tax if the value adopted by the Stamp duty authority is 5.60 lakh. And X does not challenges it under the Stamp Act. However, he claims before the Assessing Officer that Rs. 5.60 lakh is more than the fair market value of the land. The assessing Officer refers it to the valuation Officer who determines Rs. 5.25 lakh as fair market value. [CII-12-13: 852,11-12: 785,10-11:711]

A. Rs. 4,05,963/- 
B. Rs. 3,45,963/- 
C. Rs. 3,80,963/- 
D. Rs. 4,15,963/- 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 18

You as a Chartered Wealth Manager have been approached by a client who is depositing some amount in an account that pays a ROI of 12% p.a compounded monthly. She also has an option of investing in another account that pays ROI 12.76% p.a. compounded annually. She wants to know which of these is a better choice. 

A. 12% P.A compounded monthly is better 
B. 12.76% P.A. Compounded Annually is better 
C. 12.76% P.A. is better by .0775 % 
D. 12% P.A compounded monthly is better by .0775% 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 19

Jaya is the owner of two residential houses. She sold one house on 23-12-2011 for Rs.12,50,000 which was purchased by her on 25-4-1979 for Rs.80,000. The market value of the land as on 1-4-1981 was Rs.98,000. Expenses on transfer were 1.5% of the sale price. The entire sale proceeds was utilized to construct the first and second floor on her second house which she completed by 15-3-2010. Compute the capital gain for the assessment year 2012-13. [CII-12-13: 852,11-12: 785, 10-11:711, 83-84: 116]

A. 562506 
B. 461950 
C. 570360 
D. NIL 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 20

Vinod joined on 01/01/90 in ABC Ltd. and retired on 01/01/2007.Employee paid leave encashment of Rs. 4,00,000/-. His last drawn salary is Rs. 25000/-. His last 10 months average salary is 23500/-. He availed 150 days leave during the service. What will be his taxable leave salary amount?

A. 4,00,000 
B. 2,35,000 
C. 2,82,000 
D. 1,65,000 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 21

A stock caries the following returns over a five year period:

c

A. Calculate the following:
B. Arithmetic mean return,
C. Cumulative wealth index &
D. Geometric mean return.
E. 11.5%, 1.4557, 18.61%
F. 11.2%, 1.5557, 10.25%
G. 11.2%, 1.3457, 10.51%
H. 11.2%, 1.6557, 10.61%

ANSWER : D

GLO_CWM_LVL_1 Sample Question 22

Mr. Kadam is entitled to a salary of Rs. 25000 per month. He is given an option by his employer either to take house rent allowance or a rent free accommodation which is owned by the company. The HRA amount payable was Rs. 5000 per month. The rent for the hired accommodation was Rs. 6000 per month at New Delhi. Advice Mr. Kadam whether it would be beneficial for him to avail HRA or Rent Free Accommodation. Give your advice on the basis of “Net Take Home Cash benefits”. 

A. Avail HRA 
B. Rent Free Accomodation
 C. Both are Beneficial 
D. None of the Above 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 23

Rate of 15% pea compounded annually will be equal to ---------------- % per month.  

A. 1.25% per month
 B. 1.7149% per month 
C. 1.17149% per month 
D. 1.117% per month 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 24

The probability distribution of the rate of return on a stock is given below:

A. 5.69
B. 5.46
C. 7.9
D. 9.4

ANSWER : A

GLO_CWM_LVL_1 Sample Question 25

Sonia works at the post office. She deposits Rs. 1000 on every birthday into a retirement plan which paid an interest rate of 8% from the age of 20 years until she retired. If she had Rs. 260000 in her retirement plan when she retired, at what age did she retire?

A. 55
 B. 60 
C. 59 
D. 57 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 26

What amount needs to be deposited today in an account that would pay Rs. 1,10,000 per year for the first 10 years and Rs. 2,25,000 for the next 5 years. If the ROI for the first 10 years if 10.75 % p.a. compounded annually and 13% p.a. compounded quarterly for the balance period.?

A. 779030 
B. 912336 
C. 935282 
D. 995282 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 27

Find the Human Life Value for a person who is 30 years old.He wishes to retire at age of 60. Interest rate is expected to be 12%. He spends Rs. 60000 on his personal clothing and Rs. 40,000 on his conveyance. He has paid Rs. 65000 as tax for the year. His gross annual income is Rs. 5 lakhs.

A. 3022305 
B. 1822305 
C. 1722305 
D. 1625000 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 28

You are considering investing in following bond:

A. 10.91%
B. 11.38%
C. 9.07%
D. 11.78%

ANSWER : A

GLO_CWM_LVL_1 Sample Question 29

Mr. Kumar is a 40 year old NRI working abroad for past 5years. He invests Rs. 50, 000/- p.a. for past 5 years and wants to continue until his return to India. He plans to return to India after 10 years from now and enjoy his life back home. Inflation is expected to be 4% for next 30 years and his investment earns 6% interest. His expected life expectancy is 70 years. What would be his corpus at the time of return to India, and what amount he can with draw per month for his household expenses?

A. Rs. 12,14,279/- and Rs. 6,358 
B. Rs. 11,63,798/- and Rs. 5,845 
C. Rs. 13,12,008/- and Rs. 7,008 
D. Rs. 12,14,279/- and Rs. 9,554 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 30

Mr. D'suza is a operations manager in a private company college in Hyderabad. During the previous year 2011-12, he gets the following emoluments: He gets Rs. 17,500 as reimbursement from his employer in respect of medical expenditure incurred on treatment of his wife in a private clinic. Besides, he gets Rs.12, 300 as reimbursement from the employer in respect of books and journals purchased by him in discharging his official work. He contributes 11% of his salary to statutory provident fund to which a matching contribution is made by the employer. During the year, he spends Rs.17, 000 for maintaining a car for going to the college. Determine his net income under the head salaries. 

A. Rs 395300 
B. Rs 375700 
C. Rs 415300
 D. Rs 418900

ANSWER : B

GLO_CWM_LVL_1 Sample Question 31

The trust spends Rs 2,77,500 during the previous year 2009-2010 for charitable purposes.

In respect of Rs 5,20,000, it has exercised its option to spend it within the permissible timelimit

in the year of receipt or in the year, immediately following the year of receipt.

The trust spends Rs 2,00,000 during the previous year 2009-2010 and Rs 1,00,000 during

the previous year 2010-2011.

Compute the tax payable on the income of the trust.

A. 2080
B. 2160
C. 2060
D. 2200

ANSWER : C

GLO_CWM_LVL_1 Sample Question 32

Mr. Shyam has a portfolio consisting of two stocks A & B. Stock A has a standard deviation of 5 % while stock B has a standard deviation of 15%. Stock A comprises 40% of the portfolio and Stock B consists of 60%. If the correlation of returns of A& B is .5, the variance of return on the portfolio is _________.

A. –0.0035 
B. –0.0085 
C. 0.0094 
D. 0.0103 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 33

Mr. Aakash Jain has invested Rs. 85,000/- @ 6% p.a. in a bank deposit on 15th May 2007. After 10 years of investment rate of interest changes to 8 % p.a. computed half yearly. Further after 5 years rate of interest again changes to 7% p.a. compounded quarterly. After further 3 years rate of interest again changes to Rs. 7% pa compounded monthly. What will Mr. Jain get after 23 years (14th May 2030) assuming the date of commencement is now? 

A. Rs. 4,05,421/- 
B. Rs. 3,77,476/- 
C. Rs. 3,93,355/- 
D. Rs. 3,85,324/- 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 34

Portfolio X has half of its funds invested in Stock A and half invested in Stock B. Portfolio Y

has invested its funds equally in each of the three stocks. The risk-free rate is 5%, and the

market is in equilibrium.

Which of the following statements is/are correct?

A. II and III
B. Only II
C. I,II and III
D. Only IV

ANSWER : B

GLO_CWM_LVL_1 Sample Question 35

Azhar aged 30 is a disciplined investor. He has started depositing Rs. 25,000 every year in an account that pays a return of 9% every year. He plans to increase his contribution by Rs. 5000 every year till his age 50. Calculate the amount he would be having in his account at this age.?

A. 1731111 
B. 1279000 
C. 30101111 
D. 29101111 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 36

Sachin aged 35 years is married and is working as a manager in M/s Birla Mill Ltd. His most likely retirement age is 60 years. His present salary is Rs. 3,00,000/- pa. His selfmaintenance expenses are 30,000/- per year. Life insurance premium paid is 15,000/-. Income tax & professional tax amount to Rs. 20000/-. Rate of interest assumed for capitalization of future income is 8%. Calculate Sachin’s HLV to recommend adequate insurance cover

A. Rs. 20 lakh 
B. Rs. 35 lakh 
C. Rs. 45 lakh 
D. Rs. 27 Lakh 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 37

For the subsequent years, management expects the dividend to grow at 5% annually. If the

risk-free rate is 4.30%, the return on the market is 10.30% and the firm’s beta is 1.40. What

is the maximum price that you should pay for this stock?

A. Rs. 167.25
B. Rs. 41.38
C. Rs. 165.45
D. Rs. 168.86

ANSWER : B

GLO_CWM_LVL_1 Sample Question 38

Mr. Sushil, is 35 years old and working as a physician in a private hospital. He will retire at the age of 60. He is saving Rs. 30,000/- p.a. at the end of every year for past 5 years and will continue to save the same up to his retirement @ 7% p.a. His annual expenditure is Rs. 3,00,000/-. Life expectancy of Mr. Sushil is 75 years. On retirement, rate of interest is expected to be 6%. Calculate on retirement how much he can spend per annum if he leaves Rs. 5,00,000/- as estate for next generation?

A. Rs. 2,47,375 
B. Rs. 2,51,823 
C. Rs. 2,54,997 
D. Rs. 2,42,320 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 39

A trust is extinguished

A. I, II and III
B. Only I and IV
C. All of the above
D. II, III and IV

ANSWER : C

GLO_CWM_LVL_1 Sample Question 40

Miss. Nidhi Gupta has sold 600 calls on DR. REDDY’S LAB at a strike price of Rs.992 for a premium of Rs.25 per call on April 1, 2007. The closing price of equity shares of DR. REDDY’S LAB is Rs.994 on that day. If the call option is assigned against her on that day, what is her net pay off?

A. Pay-off of Rs.18300 
B. Pay-off of Rs.-18300
 C. Pay-off of Rs.-13800 
D. Pay-off of Rs.13800 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 41

Mr. Ravi aged 28 years is a marketing professional who earns a salary of Rs. 50000 p.m. He is very concerned about his retirement expenses. For the same he has started saving Rs. 6000 p.m. regularly in a bank fixed deposit paying an interest of 9.5% p.a. since the age of 23. At the age of 38, he is thinking of buying a house on his retirement which is 25 years away. He has estimated that the price of the house at his retirement will be Rs. 4000000. Calculate the amount of retirement corpus accumulated by him and the extra savings he has to make at the age of 38 in order to purchase the house? (Inflation rate = 3% p.a.)  

A. Rs. 32617751 &Rs. 9281 
B. Rs. 20036777 &Rs. 6870 
C. Rs. 32617751 &Rs. 3281 
D. Rs. 20036777 &Rs. 3500

ANSWER : C

GLO_CWM_LVL_1 Sample Question 42

A. Nil, Rs. 10,000/-
B. Rs. 10,000/- Rs. 40,000
C. Nil Nil
D. Rs. 10,000/- Rs. 10,000/-

ANSWER : A

GLO_CWM_LVL_1 Sample Question 43

Mr. John purchased a house in Mumbai in March 2010 for Rs.12,50,000. In April,2011 he entered into an agreement to sell the property to Mr. Akram for a consideration of Rs.19,75,000 and received earnest money of Rs. 50,000. As per the terms of the agreement, the balance payment was to be made within 30 days of the agreement. If the intending purchaser does not make the payment within 30 days, the earnest money would be forfeited. As Mr. Akram could not make the payment within the stipulated time the amount of Rs.50000 was forfeited by John. Subsequently John sold the house in June, 2011 for Rs.2130000. He paid 2% brokerage on sale of the house. Calculate the capital gains chargeable to tax for the assessment year 2012-13. [CII-12-13: 852,11-12: 785,10- 11:711]

A. 659322 
B. 887400 
C. 689536 
D. 692556 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 44

Mr. Rajesh Rawat deposits Rs. 15,000 per month at the end of the month for 6.50 years in an account that pays a ROI of 8.80% per annum compounded quarterly. What will be the amount in the account after 6.50 years.?

A. 1571140 
B. 1567650
 C. 91666 
D. 91654

ANSWER : B

GLO_CWM_LVL_1 Sample Question 45

Compute taxable salary of Mr. M for the Assessment year 2008-09.

A. Rs. 2,75,000
B. Rs. 3,09,850
C. Rs. 2,48,800
D. Rs. 3,53,000

ANSWER : B

GLO_CWM_LVL_1 Sample Question 46

Mr. Ajay and Vijay both are 30 years old. And both are 30 years away from their retirements. Ajay saves Rs. 10,000/- p.a. for 8 years and stops. Vijay starts investing after Ajay stops and saves Rs. 10,000/- p.a. till he retires. Their savings earn 10% p.a. compounded yearly. At the retirement what is true? 

A. Vijay saves more than Ajay by Rs. 5,99,668/- 
B. Vijay saves more than Ajay by Rs. 1,40,000/- 
C. Ajay saves more than Vijay by Rs. 1,40,000/- 
D. Ajay saves more than Vijay by Rs. 2,16,886/- 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 47

A portfolio manager is considering buying Rs. 1,00,000 worth of Treasury bills for Rs. 96,211 versus Rs. 100,000 worth of commercial paper for Rs. 95,897. Both securities will mature in nine months. How much additional return will the commercial paper generate over the Treasury bills?

A. 0.45% 
B. 0.27% 
C. 0.35% 
D. 0.21%

ANSWER : A

GLO_CWM_LVL_1 Sample Question 48

The following information regarding the equity shares of M/s V Ltd. is given


Calculate the EPS of M/s V Ltd. according to the traditional approach

A. Rs. 22.50
B. Rs. 26.00
C. Rs. 30.00
D. Rs. 27.00

ANSWER : A

GLO_CWM_LVL_1 Sample Question 49

A salaried individual, aged 45 years, was awarded a car of market value Rs. 6,50,000 by his credit card company in a draw on 20th December 2012. There was no TDS by the company. He has total income from salary of Rs. 8,45,000 in the previous year 2012-13. He saved a total of Rs. 1,80,000 under different investment instruments eligible for exemption u/s 80C and Rs. 25,000 was paid by him on 5th January, 2013 towards his health insurance policy. Find his tax liability for AY2013-14. 

A. Rs. 2,77,070/- 
B. Rs. 2,79,130/- 
C. Rs. 2,60,590/- 
D. Rs. 78,280/- 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 50

Mr. M is an employee of Z Ltd. His basic pay is Rs.24,000 p.a., Dearness Allowance Rs.12,000 p.a; Medical Allowance (fixed) Rs.10,000 p.a.; Conveyance Allowance Rs.6,000 p.a.; Professional Tax deducted from his salary Rs.1,000 p.a.; Free lunch provided during office hours valued at Rs.12,000 for a 300-working day year; free education for two children in a school owned and maintained by the employer – school tuition fee for both the children is estimated at Rs.18,000 p.a. What is Net Income of Mr. M and examine whether he is a specified or non-specified employee?

A. Rs. 51,000, Specified Employee 
B. Rs. 50,000, Non Specified Employee 
C. Rs. 48,000, Specified Employee 
D. Rs. 57,000, Non Specified Employee

ANSWER : A

GLO_CWM_LVL_1 Sample Question 51

Yami Ltd is a one of most accredited tours and travels company in India. It pays dividend per share of Rs. 0.24 on reported earning per share of Rs. 0.512 in 2011. The firms earnings per share have grown at 8% over the prior 5 year but that growth rate is expected to decline linearly over the next 5 years to 3%, while the payout ratio remains unchanged. The beta for the stock is 0.9. The risk free rate is 4.2% and the market risk premium is 4%.

A. Rs. 6.18 
B. Rs. 5.43 
C. Rs. 5.78 
D. Rs. 6.26 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 52

Mr. Amit Jain has bought a house today which cost him Rs. 50 lacs by taking a loan of 30lacs for 15 years at 11% per annum compounded monthly. He currently has 10 lacs of financial assets and plans to save Rs. 3.25 lacs every year at the beginning of the year for the next 5 years. All his investments are expected to grow at a ROI of 15%per annum compounded quarterly. What will be the net worth of Mr. Amit after 5 years if the value of the house after 5 years is expected to be 75 lacs.?

A. 8723098 
B. 7465780
 C. 11655750
 D. 9695565

ANSWER : D

GLO_CWM_LVL_1 Sample Question 53

Asit an industrialist wants to buy a car presently costing Rs. 10,00,000/- after 5 years. The cost of the car is expected to increase by 10% pea for the first 3 years and by 6% in the remaining years. Asit wants to start a SIP with monthly contributions in HDFC Top 200 Mutual Fund. You as a CWM expect that the fund would give an average CAGR of 12% in the next 5 years. Please advise Asit the monthly SIP amount starting at the beginning of every month for the next 5 years to fulfill his goal of buying the Car he desires.

A. 1495512 
B. 18614.48
 C. 20614.48 
D. 18311.71

ANSWER : B

GLO_CWM_LVL_1 Sample Question 54

Kapil is employed by SIDBI. He receives the following emoluments/facilities during 2006- 07: Basic Salary Rs.1,40,000 DA (forming part of salary) Rs.9,000 Sale of computer to him by employer sale price Rs.20,000 (Cost of computer Rs. 2,00,000 used by employee for 3 years and 9 months) Rent free accommodation, the F.R.V. of which is Rs. 24,000 p.a. His taxable income for the assessment year 2007-08 shall be: 

A. 211600  
B. 183800 
C. 178800 
D. 174800 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 55

During the past five years, the returns on the stock were as follows:

A. 34.7,5.89
B. 35.6, 5.71
C. 16, 5.59
D. None of the above

ANSWER : A

GLO_CWM_LVL_1 Sample Question 56

Calculate the death claim amount if the assured dies in the 25th year of the policy. Money back policy with SA of Rs. 50000. Term is 25 years. Survival benefits of 10% each paid at the end of 5th , 10th, 15th, and 20th years. Accrued bonus of Rs. 500 per thousand of SA.Interim bonus of Rs. 75 per 1000 of SA. 

A. 50000 
B. 57500 
C. 100000 
D. 107500 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 57

Ram purchased a house in Mumbai in March 2000 for Rs.3,50,000. In April,2011 he entered into an agreement to sell the property to Shyam for a consideration of Rs.19,75,000 and received earnest money of Rs.5,00,000. As per the terms of the agreement, the balance payment was to be made within 30 days of the agreement. If the intending purchaser does not make the payment within 30 days, the earnest money would be forfeited. As Shyam could not make the payment within the stipulated time the amount of Rs.5,00,000 was forfeited by Ram. Which of the following statement is correct in respect of the above problem? [CII-12-13: 852,11-12: 785,10-11:711,84-85: 125] 

A. Rs.500000 will be taxable as short term capital gain 
B. Rs.500000 will be taxable as long term capital gain 
C. Rs.150000 will be taxable under some other head other sources
D. Rs.150000 is not liable to tax 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 58

A. 2177626
B. 2379057
C. 2797057
D. 3379057

ANSWER : B

GLO_CWM_LVL_1 Sample Question 59

The Portfolio consists of two securities, X and Y in the ratio of 70:30. Given that


and covariance between them is 16%, what is the portfolio risk?

A. 13.77%
B. 8.04%
C. Nil
D. 25%

ANSWER : B

GLO_CWM_LVL_1 Sample Question 60

Akash owns a piece of land situated in Kolkata ( Date of acquisition : March 1, 1983, Cost of acquisition Rs. 20,000/- value adopted by Stamp duty authority at the time of purchase Rs. 45,000/-) On March 30, 2012 the piece of land is transferred for 4 lakh. Find out the capital gains chargeable to tax if the value adopted by the Stamp duty authority is 5.75 lakh. And X files an appeal under the Stamp Act and Stamp duty valuation has been reduced to Rs. 4.90 lakh by the Kolkata High Cout. [CII-12-13: 852,11-12: 785,10-11:711] 

A. Rs. 4,05,963/- 
B. Rs. 3,45,963/- 
C. Rs. 3,80,963/-
 D. Rs. 4,15,963/- 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 61

Vishal is working with Amex Ltd since October 1, 1997. He is entitled to a basic salary of Rs. 6,000 pm.Dearness Allowance is 40% of Basic Salary for retirement benefits. He retired from his job on December 1,2010 (4 months before the end of F.Y 2010-11) and shifted to his village. He is entitled to the following benefits at the time of retirement. Gratuity = Rs. 98,000. Pension from December 1, 2008 = Rs. 2,000 per month. Payment from recognized PF = Rs. 3,00,000. Encashment of earned leave for 150 days = Rs. 36,000. He was entitled to 40 days leave for every completed year of service. He got 50% of his pension commuted in lump sum w.e.f March 1, 2011 and received Rs. 1,20,000 as commuted pension. Vishal contributes Rs. 900 per month to RPF to which his employer contributes an equal amount. What will be the amount of un-commuted pension for Vishal that will form part of his total income for the A.Y. 2011-12?

A. NIL 
B. Rs 1000 
C. Rs 4000 
D. Rs 7000 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 62

Vishal is working with Amex Ltd since October 1, 1997. He is entitled to a basic salary of Rs. 6,000 pm.Dearness Allowance is 40% of Basic Salary for retirement benefits. He retired from his job on December 1,2010 (4 months before the end of F.Y 2010-11) and shifted to his village. He is entitled to the following benefits at the time of retirement. Gratuity = Rs. 98,000. Pension from December 1, 2008 = Rs. 2,000 per month. Payment from recognized PF = Rs. 3,00,000. Encashment of earned leave for 150 days = Rs. 36,000. He was entitled to 40 days leave for every completed year of service. He got 50% of his pension commuted in lump sum w.e.f March 1, 2011 and received Rs. 1,20,000 as commuted pension. Vishal contributes Rs. 900 per month to RPF to which his employer contributes an equal amount. What will be the amount of un-commuted pension for Vishal that will form part of his total income for the A.Y. 2011-12?

A. NIL 
B. Rs 1000 
C. Rs 4000 
D. Rs 7000 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 63

Suresh is an employee of a private company in Mumbai. He draws an amount of Rs 36,000pm as basic salary. He also receives Rs 8000 as HRA. He has taken a house on rent from 1st October and pays Rs 10,000pm as rent for his house accomodation. What would be the taxable HRA? 

A. Rs 19,200 
B. Rs 76,800 
C. Rs 57,600 
D. Rs 96,000

ANSWER : C

GLO_CWM_LVL_1 Sample Question 64

The current dividend on an equity share of MAGADH Limited is Rs.8.00 on earnings per share of Rs. 30.00. Assume that the growth rate of 20 percent will decline linearly over a five year period and then stabilize at 12 percent. What is the intrinsic value of MAGADH ’s share if the investors’ required rate of return is 15 percent? 

A. Rs. 352/- 
B. Rs. 383/-
 C. Rs. 416/- 
D. Rs. 469/-

ANSWER : A

GLO_CWM_LVL_1 Sample Question 65

Mr. Neeraj Gupta wants to withdraw Rs. 50,000 per quarter form an account after 3 years for 6 years. How much should he deposit in this account today if the ROI is 12% p.a. compounded quarterly.?

A. 846777 
B. 593912 
C. 693912 
D. 774921 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 66

Rhona has a daughter Zena five years old. She wants to plan for Zena’s education and has found out that she would be requiring 2,75,000 at her age 18 and another 4,50,000 on her age 25. She also wants to have Rs. 10,00,000 for Zena’s Marriage which she expects at the age of 28. She wants to deposit the entire amount for these expenses today in an account that pays a ROI of 15% per annum compounded annually. What would this amount be?

A. 40174 
B. 27495 
C. 144695 
D. 112365 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 67

Ram purchased a house in Mumbai in March 2004 for Rs.12,50,000. In April, 2011 entered into an agreement to sell the property to Shyam for a consideration of Rs.19,75,000 and received earnest money of Rs.50,000. As per the terms of the agreement, the balance payment was to be made within 30 days of the agreement. If the intending purchaser does not make the payment within 30 days, the earnest money would be forfeited. As Shyam could not make the payment within the stipulated time the amount of Rs.50,000 was forfeited by Ram. Subsequently Ram sold the house in June,2012 for Rs. 21,30,000. He paid 2% brokerage on sale of the house. Calculate the capital gains chargeable to tax for the assessment year 2012-13. [CII-12-13: 852,11-12: 785,10-11:711,03-04:463]

A. 52,843 
B. 659322 
C. 253565
 D. 659002 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 68

Ankur Kalra is 33 years old finance professional. The house hold expenditure of Mr. Kalra is 20,000/- p.m. to maintain his current living standard. He assumes that his living standard will increase 1.5% annually until his retirement at 60. His life expectancy is 70 years. At retirement he needs 75% of his last year’s expenses. Inflation rate for the next 45 years is expected to be 4% p.a. Calculate how much would Mr. Kalra require in the first year after his retirement, and how much he has to save at end of every year to accumulate this corpus, if the return on investment is 7% p.a.?

A. Rs. 10,09,656/-, and Rs. 89,508/- 
B. Rs. 7,63, 992/- and Rs. 90,550/- 
C. Rs. 8,26,912/- and Rs. 85470/- 
D. Rs. 9,20,338/- and Rs. 98,862/- 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 69

Shruti has invested Rs. 12000 for 8 years at the rate of interest of 6%. What amount she will get after 8 years if amount is compounding annually for the first 5 years and semi annually for the last 3 years?

A. 19803.43
 B. 19174.92 
C. 18976.24 
D. 19203.46 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 70

Mohan is a manager in ABC Co. Ltd. His family consists of his wife and child. It is assumed that his family needs a minimum of Rs. 10,000 per month to maintain current standard of life in unfortunate case of demise of Mohan. The interest rate is 6% pa. Calculate how much insurance is required under income replacement method? 

A. 20 lakhs  
B. 15 lakhs 
C. 25 lakhs 
D. 18 lakhs 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 71

Ram purchased a house in Mumbai in March 2000 for Rs.3,50,000. In April,2009 he entered into an agreement to sell the property to Shyam for a consideration of Rs.1975000 and received earnest money of Rs.500000. As per the terms of the agreement, the balance payment was to be made within 30 days of the agreement. If the intending purchaser does not make the payment within 30 days, the earnest money would be forfeited. As Shyam could not make the payment within the stipulated time the amount of Rs.500000 was forfeited by Ram. Subsequently Ram sold the house in June,2009 for Rs.2130000. He paid 2% brokerage on sale of the house. Calculate the capital gains chargeable to tax for the assessment year 2010-11. [CII-12-13: 852,11-12: 785,10-11:711,09-00:389] 

A. 2087400
 B. 887400 
C. 695322 
D. 659322

ANSWER : A

GLO_CWM_LVL_1 Sample Question 72

Mr. Sachdeva is working as a regional head in a Pharmaceutical Company in New Delhi. He has a annual income of Rs. 10,00,000. His current expenses are Rs. 5,00,000 and he will be retiring in next ten years . The inflation rate for the foreseeable future is expected to be 5%. He assumes that his post retirement expenses will be 70% of his last year expenses of his service and they will increase at inflation rate and paid at the beginning of each year. On his retirement he plans to leave his current rented apartment and shift into a another apartment located in NCR . The current price of the bungalow is Rs. 24 lakh which is estimated to increase in line with inflation rate. A ten year government security paper fetches 10% interest rate, which will remain constant for the forthcoming period. He is in good health and expects to live for twenty years after retirement. As a CWM you are required to calculate the amount Mr. Sachdeva needs to save at the end of ten years on an annual basis so that he can pay his post retirement expenses as well as to buy the apartment

A. Rs 467000 
B. Rs 510000
 C. Rs 493000 
D. Rs 475000 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 73

Mr. Munjal has got her daughters son admitted to a dental college today, where he has to pay a fee of Rs. 1.5 Lac today i.e. at the time of admission. Then Rs. 1.75 lacs after 1 year, Rs. 2.5 lacs after 2 years and Rs. 3.25 lacs after 3 years. He wants to set aside the amount required today itself in the form of a Bank FDR.So how much he needs to put aside today if ROI is 8% for 1 year, 8.5% for 2 years and 9% for 3 years, all compounded Quarterly?

A. Rs. 7,71,807.05 
B. Rs. 7,81,911.05 
C. Rs. 8,93,541.07 
D. Rs. 8,51,657.10

ANSWER : A

GLO_CWM_LVL_1 Sample Question 74

A. Option A
B. Option B
C. Option C
D. Option D

ANSWER : B

GLO_CWM_LVL_1 Sample Question 75

X owns a piece of land situated in Varanasi ( Date of acquisition : March 1, 1983, Cost of acquisition Rs. 20,000/- value adopted by Stamp duty authority at the time of purchase Rs. 45,000/-) On March 30, 2012 the piece of land is transferred for 4 lakh. Find out the capital gains chargeable to tax if the value adopted by the Stamp duty authority is 5.5 lakh. And X does not dispute it. [CII-12-13: 852,11-12: 785,10-11:711]

A. Rs. 4,05,963/- 
B. Rs. 3,45,963/- 
C. Rs. 3,80,963/-
 D. Rs. 4,15,963/- 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 76

A property has 120 rooms and each room has a monthly rent of Rs.750. The occupancy rate throughout the year is 80% and maintenance expenses per year works out to be Rs.3,00,000. Capitalization rate is 12%. Calculate the value of the property? 

A. Rs.45 lacs
 B. Rs.47 lacs 
C. Rs.46 lacs 
D. Rs.44 lacs 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 77

Mr. Patel expects the stock of A to sell for Rs. 70/- a year from now and to pay Rs. 4/- dividend. If the stock’s correlation with the Market is –0.3, and the standard deviation of A is 40% and standard deviation of the Market is 20% and the risk free rate of return is 5% and the market risk premium is 5% , what would be the price of stock A be now ?

A. 74 
B. 73.65 
C. 72.55 
D. 75.65

ANSWER : C

GLO_CWM_LVL_1 Sample Question 78

The actual rent paid by him is Rs. 2,000 p.m. for an accommodation at Noida till 31-12-

2006.From 1-1-2007 the rent was increased to Rs. 4000 p.m. Compute the taxable HRA?

A. Rs. 16, 500
B. Rs. 26,250
C. Rs. 19,125
D. Rs. 31,500

ANSWER : A

GLO_CWM_LVL_1 Sample Question 79

Yogesh Jain is a Chartered Accountant by profession and a very disciplined investor he has started investing from today in an account Rs. 1,00,000 every year (beginning of year) and plans to increase his contribution by 10% every year. If the ROI he gets is 15% per annum compounded half yearly calculate the corpus he would be able to accumulate in 25 years.?

A. 47379847 
B. 52117831 
C. 48763660 
D. 44330600 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 80

Pankaj is an employee of a private company in Jabalpur. He draws an amount of Rs 36,000pm as basic salary. He also receives Rs 8000 as HRA. He has taken a house on rent from 1st October and pays Rs 10,000pm as rent for his house accomodation. What would be the taxable HRA?

A. Rs. 96,000 
B. Rs 19,200 
C. Rs 76,800 
D. Rs 57,600

ANSWER : D

GLO_CWM_LVL_1 Sample Question 81

Mahesh earns 1,20,000 pa. He has total debt of Rs. 2,00,000 and have two dependants. Interest rate is 7%, and assumes 80% of his pre-death salary is the estimated requirement to maintain his family after paying the loan. Calculate the life insurance cover needed under multiple approach method.

A. 18 lakhs 
B. 15 lakhs 
C. 12 lakhs 
D. 16 lakhs 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 82

Mr.Singhvi is a senior manager in a advertising firm in Mumbai. During the previous year 2011-12, he gets the following emoluments: Basic salary Rs.30, 000 per month, dearness allowance: 10% of basic salary, city compensatory allowance: Rs.300 per month, children education allowance:Rs.500 per month (for 3 children), house rent allowance: 20% of salary (rent paid Rs.2000 per month). He gets Rs. 21,000 as a reimbursement from his employer in respect of medical expenditure incurred on treatment of his wife in a private clinic. Besides, he gets Rs.12, 400 as reimbursement from the employer in respect of books and journals purchased by him in discharging his official work. He contributes 11% of his salary to statutory provident fund to which a matching contribution is made by the employer. During the year, he spends Rs.15, 000 for maintaining a car for going to the college. Determine his net income under the head of salaries. 

A. 426600 
B. 417600 
C. 515600 
D. 528600 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 83

Saurabh contributes Rs. 10,000 every year starting from the end of the 5th year from today till the end of 12th year in the account that gives a ROI of 7.75% p.a. compounded half yearly. Calculate the Present Value of his contribution today. 

A. 39441
 B. 39800 
C. 42557 
D. 36500 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 84

Ms. Sonali Briganza is 22 years old. She is currently earning a salary of Rs.5,00,000/- per annum and saves 20% of her salary every year. If her salary increases by 10% every year and she is able to get a return of 11% p.a. compounded annually throughout her investment horizon what would be the corpus of funds available at her age 58.? 

A. 119056000
 B. 117056000
 C. 129056000 
D. 139056000 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 85

Vinod is projecting an income stream providing Rs. 2,000/- for first 3 months, Rs. 3,200 for next 2 months, Rs. 4,500 for next 1 month, Rs. 3,700 for next 6months and Rs. 800 for 2 months thereafter. Please calculate the Present Value of this cash stream if rate of interest is 9%

A. 24465.92 
B. 25817.12 
C. 24,513.72 
D. 23478.68 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 86

Rs. 1.50 lakh settled on a trust for the benefit of Akash and Bina for life. They share the income in proportion of 3:2.Their ages on valuation date are 20 years and 16 years. The average annual income for the last three years on the valuation date is Rs. 15,000/-. Find out the value of life interest of Akash and Bina if the value of life interest of Re 1/- at the age of 20 years is 12.273 and at the age of 16 years is 12.534. 

A. Akash Rs. 1,10,457/- Bina Rs. 75,204/-
 B. Akash Rs. 89,241/- Bina Rs. 60,759/- 
C. Akash Rs. 1,10,457/- Bina Rs. 60,759/- 
D. Akash Rs. 60,759/- Bina Rs. 75,204/- 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 87

Ram deposits Rs. 12,500 in an account that pays a ROI of 20% pea compounded annually on 5th. Of March 2010. Calculate the date on which the balance in his account would be Rs.35,338/-.

A. 15thOf November 2015 
B. 15thOf August 2015 
C. 25thOf November 2015
 D. 15th. Of August 2016

ANSWER : A

GLO_CWM_LVL_1 Sample Question 88

Dhruv contributes Rs. 25,000 every year starting from the beginning of the 4th year from today till the begning of 12th year in the account that gives a ROI of 11.40% p.a. compounded half yearly. Calculate the Present Value of his contribution today. 

A. 96522 
B. 107840 
C. 97907.72 
D. 101452 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 89

Michael estimates opportunity cost of investment to be 10.5% compounded annually. Which of the following is the best proposal? 

A. Receive Rs. 5,500/- at beginning of each year for 15 years 
B. Receive Rs. 5,500/- at the end of each year for 19 years 
C. Receive Rs. 45,000/- today 
D. Receive Rs. 1,20,000/- at the end of 10 years 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 90

R acquired a property by way of gift from his father in the previous year 1991-92 when its FMV was Rs. 3 lakh. The father had acquired the property in the previous year 1983-84 for Rs. 2 lakh. This property was introduced as capital contribution to a partnership firm in which R became a partner on 10/06/2011. The market value of the asset as on 10/06/2011 was 10 lakh, but it was recorded in the books of account of the firm at Rs. 8 lakh. Compute the capital gain chargeable in the hands of R. 

A. Rs. 11,055/- 
B. Rs. 7,040/- 
C. Nil 
D. Rs. 3,075/- 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 91

R purchased a house property for Rs. 26,000 on 10-5-1962. He gets the first floor of the house constructed in 1967-68 by spending Rs. 40,000. He died on 12-9-1978. The property is transferred to Mrs. R by his will. Mrs. R spends Rs. 30,000 and Rs. 26,700 during 1979- 80 and 1985-86 respectively for renewals/reconstruction of the property. Mrs. R sells the house property for Rs. 11,50,000 on 15-3-2007, brokerage paid by Mrs. R is Rs. 11,500. The fair market value of the house on 1-4-1981 was Rs. 1,60,000. Find out the amount of capital gain chargeable to tax for the assessment year 2007-08.

A. 308100 
B. 215410 
C. 169527 
D. 203910

ANSWER : D

GLO_CWM_LVL_1 Sample Question 92

Ramesh aged 50 could not save for his retirement till date but now decides to save Rs. 50000 per month till his retirement age of 65. He anticipates that the return in the first 5 years would be 13% p.a. next 5 years 10% and in the last 5 years 8% p.a. He wants to accumulate a corpus of Rs. 1.50 Crores till his retirement. Calculate the surplus or shortfall he would have on his retirement.

A. Surplus 40 Lacs 
B. Shortfall 40 Lacs
 C. Surplus 29 Lacs 
D. Shortfall 15 Lacs 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 93

You wish to save for your son’s education the present cost of which is Rs. 320000 and is expected to increase by 6% every year. If your son is 12 years old and will require money in 8 years time, what is the annual amount of investment to be made if it is likely to earn 12% rate of return?

A. 205993
 B. 205670 
C. 210000 
D. 209553

ANSWER : A

GLO_CWM_LVL_1 Sample Question 94

Mr. Chopra runs a Garment Factory, he is very concerned about his retirement and wants you to help him out in planning for it. His Current annual expenses are Rs. 12,00,000 which would be rising at an annual rate of 8% pre- retirement and 2% post retirement. His current age is 50 years and he wants to work till the age of 65. The expected life expectancy in his family is 75 years. Calculate the monthly contribution he must make till his retirement if the pre- retirement returns are 12% p.a. compounded monthly and post-retirement returns are 8% pea compounded annually.? 

A. 60973 
B. 59712 
C. 72376 
D. 56320 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 95

Smt. Rajalakshmi owns a house property at Adyar in Chennai. The municipal value of the property is Rs. 5,00,000, fair rent is Rs. 4,20,000 and standard rent is Rs. 4,80,000. The property was let-out for Rs. 50,000 p.m. up to December 2010. Thereafter, the tenant vacated the property and Smt. Rajalakshmi used the house for self-occupation. Rent for the months of November and December 2010 could not be realized in spite of the owner's efforts. She paid municipal Texas @12% during the year. She had paid interest of Rs.25,000 during the year for amount borrowed for repairs for the house property. Compute her income from house property for the A.Y. 2012-13.

A. Rs 281500 
B. Rs 275500 
C. Rs 269000 
D. Rs 265400 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 96

How much amount should be invested by Mr. Batra today to get a maturity value of Rs. 90,368.50 after 6 years, if available ROI is 10% and compounding is Quarterly for first 2 years, Half Yearly for next 2 years and Monthly for last 2 years?

A. Rs. 55535 
B. Rs. 50000 
C. Rs. 49000
 D. Rs. 51585 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 97

Sunil, aged 33 years, is having a policy of Rs. 1 Lac sum assured and is paying premium of Rs. 1,800/- for the last 10 years. The cash surrender value of this policy is at the end of previous year was Rs. 20,000. It is estimated that by this year end, the cash surrender value of this policy would be Rs. 22,900. There is another term insurance of sum assured of Rs. 80,000 costs Rs. 300/- per annum which is available to him . If rate of interest is 6%, then first calculate the CPT of existing and new policy respectively and then advise Sunil if it is better to continue this policy or to discontinue it?

A. 2.69 ,3.77.Continue this policy 
B. 3.45,4.33.Continue this policy 
C. 3.19 ,2.89.Discontinue this policy 
D. 4.13 ,3.97.Disontinue this policy 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 98

A zero coupon bond of Rs 10,000 has a term to maturity of seven years and a market yield of 9 percent at the time of issue. What is the issue price? What is the duration of the bond? What is the modified duration of the bond?

A. Rs. 5470/-, 7 years, 6.422 
B. Rs. 6380/- 6 years, 7.368 
C. Rs. 5470/-, 7 years, 5.364
 D. Rs. 6380/-, 6 years, 6.897

ANSWER : A

GLO_CWM_LVL_1 Sample Question 99

Puspinder Singh Ahluwalia took a housing loan on 1st. of June 2009 (EMI in arrear) of Rs. 50 lacs at a ROI of 10.75% p.a. compounded monthly for 12 years. He wants to know the deduction in taxable income he can claim u/s 24 of the IT act for the FY 2011 -12

A. 480178 
B. 150000 
C. 330178 
D. 125000

ANSWER : B

GLO_CWM_LVL_1 Sample Question 100

Vinod Khanna, aged 27 years, is having a policy of Rs. 15 Lac sum assured and is paying premium of Rs. 14,800/- . The cash surrender value of this policy is at the end of previous year was Rs. 35,000. It is estimated that by this year end, the cash surrender value of this policy would be Rs. 40,000/-. Bonus under this old policy is Rs. 10,000/-. There is another term insurance policy of Rs. 15 Lac Sum Assured is available to Vinod at Rs. 4,200/- per annum. If rate of interest is 8 % then first calculate the CPT of existing and new policy respectively and then advise Vinod if it is better to continue this policy or to discontinue it? 

A. 2.59 ,2.88.Continue this policy 
B. 2.45,3.35.Continue this policy 
C. 3.91 ,2.79.Discontinue this policy 
D. 3.13 ,2.97.Disontinue this policy 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 101

Savitri is 30 years old. She saves Rs. 14,000/- p.a. (year end) in FD 8.75% p.a. compounded annually until she retires at age 58. Her life expectancy is 80 years. What would be her corpus at the time of retirement? What is the fixed amount she can withdraw at the beginning of each year, until age 80, in case she wishes to exhaust the whole corpus? Inflation is 5%.

A. Rs. 13,68,748/-, Rs. 87,498/- 
B. Rs. 14,96,855/-, Rs. 1,37,767/- 
C. Rs. 15,15,481/-, Rs. 97,145/- 
D. Rs. 14,24,894/-, Rs. 89,458/- 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 102

Vikas is 35 years old working as a regional head of a multinational bank and plans to retire at 55 and is earning a salary of Rs. 4,00,000/- p.a. His life expectancy is another 15 year after retiring. He is able to save Rs. 85,000 /- p.a. (END) and regularly invests it in a 6% p.a. investment plan. Calculate what will be the Vikas’s total accumulation at his retirement? And how much he can spend per every year at beginning if he dies at the age of 70 and assuming that he leaves behind Rs. 1,00,000/- as estate.?

A. Rs. 30,22,825/- &Rs. 2,98,763/- 
B. Rs. 31,26,775/- &Rs. 2,99,665/- 
C. Rs. 30,62,860/- &Rs. 2,78,863/-
 D. Rs. 31,42,780/- &Rs. 3,45,895/- 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 103

Given the following diversified mutual fund performance data, which fund has the best risk adjusted performance if the risk free rate of return is 5.7% 

A. Fund b because the annual return is highest 
B. Fund a because the Treynor ratio is lowest 
C. Fund d because the Treynor ratio is highest 
D. Fund c because the Sharpe ratio is lowest 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 104

The expected return and standard deviations of stock A & B are: 
Amit buys Rs.20,000 of Stock A and sells short Rs.10,000 of Stock B using all the Proceeds to buy more or Stock A. The correlation Between the two securities is .35. What are the expected return & standard deviation of Amit’s portfolio?

A. 3.5%, 15.5% 
B. 8.8%, 7.03% 
C. 20%, 14.5% 
D. 9.8%, 15.6% 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 105

Consider the following information:  

Which of the following statements is/are true? 

A. Only II 
B. Only III
 C. Only II 
D. None of the above 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 106

From the following data on mutual funds, Calculate the Sharpe Ratio.  a
Risk free return is 8%

A. 0.78,1.08,0.55 
B. 0.78,1.05,0.59
 C. 0.98,1.33,0.75 
D. 0.71,1.11,0.55 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 107

What is the present value of the following cash flows,if the Interest rate is 8% 

A. 2639 
B. 2962 
C. 3961 
D. 3962 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 108

Consider the following information for three stocks, Stock A, Stock B, and Stock C. The returns on each of the three stocks are positively correlated, but they are not perfectly correlated.
Portfolio X has half of its funds invested in Stock A and half invested in Stock B. Portfolio Y has invested its funds equally in each of the three stocks. The risk-free rate is 5%, and the market is in equilibrium. Which of the following statements is/are correct?

A. II and III 
B. Only II 
C. I,II and III 
D. Only IV 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 109

A Portfolio manager is holding the following portfolio: 
The risk free rate of return is 6% and the portfolio’s required rate of return is 12.5%. The manager would like to sell all of his holdings in stock A and use the proceeds to purchase more shares of stock D. What would be the portfolio’s required rate of return following this change?

A. 13.63% 
B. 10.29% 
C. 11.05% 
D. 12.52%

ANSWER : A

GLO_CWM_LVL_1 Sample Question 110

Consider the following information for three mutual funds:   
Market Return 10% Risk free return is 6%. Calculate the Risk Adjusted Return on the basis of Jensen measure (%)?

A. 3.45, 7.78, 4.38 
B. 2.50, 8.50, 6.60 
C. 3.60, 2.40, 6.20 
D. 3.65, 8.88, 9.36 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 111

Which of the following is/are the desirable contents of a will? 

A. I ,II and III 
B. II , III and IV 
C. I, III and IV
 D. All of these 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 112

Ramesh retired as General Manager of XYZ Co. Ltd. On 30.11.2012 after rendering service for 20 years and 10 months. He received Rs. 300000 as gratuity from the employer. (He is not covered by Gratuity Act, 1972). His salary particulars are given below:  

He resides in his own house interest on monies borrowed for the self occupied house is Rs. 24000 for the year ended 31.03.2013 Compute taxable income of Ramesh for the year ended 31.03.2013.

A. 258900 
B. 272600 
C. 265450 
D. 285470 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 113

What is the present value of the following cash flows,if the Interest rate is 8%? 

A. 3668
 B. 2962 
C. 3961 
D. 3962 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 114

Find out the taxable value of perquisite from the following particulars in case of an employee to whom the following assets held by the company were sold on 1.8.2012.
The assets were put to use by the company from the day they were purchased. 

A. Rs. 82,170 
B. Rs. 92,850
 C. Rs. 48,800 
D. Rs. 53,000 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 115

Mr. Malhotra and Mrs.Malhotra aged 50 and 45 years respectively, both have a life expectancy of 35 years. You have following information  

Calculate the adequate insurance required based on need based approach. 

A. 65 lakhs  
B. 60 lakhs 
C. 54 lakhs 
D. 44 lakhs 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 116

X furnishes the following particulars for the compilation of his wealth-tax return for assessment year 2012-13.

A. Rs. 2 lakh 
B. Rs. 9.50 lakh 
C. Rs. 17 lakh 
D. Rs. 9 lakh 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 117

Which of the following statements is/are correct? 

A. Only (i)
 B. Only (i) & (ii)
 C. Only (i) & (iii) 
D. All of the above 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 118

The list of managing body needs for be fixed with Registrar of Joint Stock companies 

A. Only (i)  
B. Only (ii)  
C. (i) & (iii)  
D. Only (iv)  

ANSWER : C

GLO_CWM_LVL_1 Sample Question 119

Is the Z Ltd. efficiently priced according to the CAPM by taking the above information? 

A. Share price is higher and efficiently priced 
B. Share price is lower and not efficiently priced
 C. Share price is lower and efficiently priced 
D. Share price is higher and not efficiently priced 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 120

Calculate the total return on the mutual fund investment with the below mentioned information:

A. 24.52%
 B. 22.47% 
C. 23.52% 
D. 23.75%

ANSWER : C

GLO_CWM_LVL_1 Sample Question 121

A portfolio consists of 3 securities.  

What is the standard deviation of the portfolio? 

A. 2.5 
B. 3.5 
C. 7.7 
D. 6.9 

ANSWER : C

GLO_CWM_LVL_1 Sample Question 122

Given the following information:  

What is the expected return and standard deviation of the portfolio if 50% of funds invested in each stock? What would be the impact if the correlation coefficient were 0.6 instead of 0.2?

A. 18%, 0.456, 0.312 
B. 16%, 0.398, 0.296 
C. 16%, 0.314, 0.273 
D. 19%, 0.429, 0.316

ANSWER : C

GLO_CWM_LVL_1 Sample Question 123

Calculate expected rate of return on the following portfolio? 
Weight of X and Y in the portfolio is 50% and 50% respectively. 

A. 19.25% 
B. 15.35% 
C. 16.40% 
D. 17.85% 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 124

The information about 3 stocks is provided below: 
Assuming that the required rate of return on investment is 14%, what maximum price an investor should be willing to pay and Which Stock should he buy?

A. Rs. 23.15/-, Rs. 47.50/-, Rs.70.45/- , Share C 
B. Rs. 15.29, Rs. 43.71, Rs. 63.64, None 
C. Rs. 15.29, Rs. 22.50, Rs. 49.50, Share B and C 
D. Rs. 16.36, Rs. 49.67, Rs. 69.75, Share B only 

ANSWER : B

GLO_CWM_LVL_1 Sample Question 125

Given the following information what is the expected return on the portfolio of two securities where both are held in equal weights?  

A. 15% 
B. 19% 
C. 16% 
D. 17% 

ANSWER : A

GLO_CWM_LVL_1 Sample Question 126

Which of the following option illustrates an advantage of the probate process? 

A. (i) only 
B. (ii) and (iii) 
C. (ii), (iii) & (iv) 
D. (i), (ii), (iii) & (iv) 

ANSWER : D

GLO_CWM_LVL_1 Sample Question 127

The Risk free return rate is 5%. Calculate the Jensen Measure of RELIANCE, TATA, & SBI

Fund.

A. 0.60, – 1.65, – 1.45
B. 0.60,1.65,1.45
C. 1.65, – 1.65, – 1.45
D. None of the above

ANSWER : A

GLO_CWM_LVL_1 Sample Question 128

The probability distribution of the rate of return on ABC stock is given below:


What is the standard deviation of return?

A. 11.40%
B. 12.90%
C. 10.50%
D. 13.50%

ANSWER : B

GLO_CWM_LVL_1 Sample Question 129

Which assets are totally except from wealth tax?

A. (i), (ii), (iii)
B. (i), (ii), (iii), (iv), (v)
C. (iv), (v)
D. (ii), (iii) (v)

ANSWER : B

GLO_CWM_LVL_1 Sample Question 130

A stock earns the following returns over a five year period:


What is the standard deviation of returns for the stock?

A. 22.24
B. 21.38
C. 26.71
D. 24.62

ANSWER : C

GLO_CWM_LVL_1 Sample Question 131

A. Yes, because the payback is 2.5 years.
B. Yes, because the discounted payback is less than 4 years.
C. Yes, because both the payback and the discounted payback are less than 2 years
D. No, because the NPV is negative

ANSWER : D

GLO_CWM_LVL_1 Sample Question 132

From the following information of assets assets and liabilities, the taxable wealth for:

A. Rs 1,10,00,000 & Rs 40,00,000 respectively
B. Rs 1,00,00,000 & Rs 40,00,000 respectively
C. Rs 1,10,00,000 & Rs 50,00,000 respectively
D. Rs 70,00,000 & Rs 40,00,000 respectively

ANSWER : A

GLO_CWM_LVL_1 Sample Question 133

You own 3 scripts with their market value at


Calculate the CAGR of portfolio.

A. 5%
B. 10.26%
C. 1.64%
D. 11.16%

ANSWER : C

GLO_CWM_LVL_1 Sample Question 134

You own 3 scripts with their market value at Start of year end of year (3rd) total growth.


Calculate the CAGR of portfolio.

A. 5%
B. 10.26%
C. 1.64%
D. 11.16%

ANSWER : C

GLO_CWM_LVL_1 Sample Question 135

A. CBA
B. ACB
C. ABC
D. BAC

ANSWER : B

GLO_CWM_LVL_1 Sample Question 136

A. Rs 1.05 lakh and Rs 4.95 lakh
B. Rs 70,000 and Rs 3.95 lakh
C. Rs 1.05 lakh and Rs 3.95 lakh
D. Rs 70,000 and Rs 4,30,000

ANSWER : C

GLO_CWM_LVL_1 Sample Question 137

Calculate the Paid up Value ( PV) under a policy with the following particulars:

A. Rs. 19,750
B. Rs. 18,000
C. Rs. 33,500
D. Rs. 31,750

ANSWER : C

GLO_CWM_LVL_1 Sample Question 138

Assume Alok takes a flat on rent from 01 /07/2006. On 01 /07/2006 he has cash in hand

Rs. 1450/-. He starts paying insurance premium from October @ Rs. 2500/- pm. His

investments in Mutual fund SIP are Rs. 3000/- pm for a 6 month period. What will be his

cash in hand on 31/03/2007.?

A. Rs.72150/-
B. Rs.83150/
C. Rs.69070/-
D. None of the above

ANSWER : C

GLO_CWM_LVL_1 Sample Question 139

A. Business: Rs 4,61,82,645, House: Rs 2,77,09,587, Hospital: Rs 97,17,000
B. Business: Rs 3,07,88,430, House: Rs 1,23,15,372, Hospital: Rs 97,17,000
C. Business: Rs 2,77,09,587, House: Rs 2,77,09,587, Hospital: Rs 80,97,653
D. Business: Rs 3,69,46,116, House: Rs 1,84,73,058, Hospital: Rs 97,17,000

ANSWER : B

GLO_CWM_LVL_1 Sample Question 140

Property was vacant for 3 months.

Compute the income under the head “Income from House Property” for the A.Y. 2012-13.

A. Rs 1000
B. 1500
C. 5000
D. 3500

ANSWER : A

GLO_CWM_LVL_1 Sample Question 141

Consider two stocks, A and B

A. 22.24
B. 20.48
C. 19.57
D. 24.62

ANSWER : B

GLO_CWM_LVL_1 Sample Question 142

A. 734.50, 740.90, 754.35, 754.35
B. 751.70, 754.35, 740.90, 734.50
C. 734.50, 754.35, 751.70, 740.90
D. None of the above

ANSWER : A

GLO_CWM_LVL_1 Sample Question 143

Consider the following information for three mutual funds:


Calculate Jensen measure (%)?

A. 1.70, 5.30, 3.40
B. 4.35, 3.78, 2.53
C. 2.25, 3.78, 4.65
D. 3.17, 4.58, 5.78

ANSWER : A

GLO_CWM_LVL_1 Sample Question 144

Calculate the portfolio’s expected return & standard deviation if Ashish invests 20% in stock

X, 50% in stock Y & 30% in stock Z. Assume that each security is completely uncorrelated

with the return of other securities.

A. 6.25%, 6.54
B. 5.25%, 2.55
C. 8.45%, 3.75
D. 4.25%, 6.54

ANSWER : A

GLO_CWM_LVL_1 Sample Question 145

For the remaining years, the management expects the dividend to grow at 5% annually. If

the risk-free rate is 4.30%, the return on the market is 10.30% and the firm’s beta is 1.40.

What is the maximum price that you should pay for this stock?

A. Rs. 42.39
B. Rs. 41.38.
C. Rs. 47.45
D. Rs. 39.15

ANSWER : B

GLO_CWM_LVL_1 Sample Question 146

Case: Read the data given below & answer the following questions:


Market sensitive index will be:

A. 1.50%
B. 0.80%
C. 10
D. 1

ANSWER : D

GLO_CWM_LVL_1 Sample Question 147

The following parameters are available for four mutual funds:

A. Calculate Treynor’s performance index for each of the funds on the assumption thatr=6% where r stands for the risk – free interest rate.
B. 6, 2.5, 1.43, 0
C. 7, 2.5, 2.43, 4
D. 5, 2.5, 1.43, 5
E. 6, 2.5, 1.43, 2

ANSWER : A

GLO_CWM_LVL_1 Sample Question 148

A. Project A, because it has a smaller initial investment
B. Project B, because it has a higher NPV
C. Project A, because it has the higher internal rate of return
D. Either one, because they have the same profitability indexes

ANSWER : B

GLO_CWM_LVL_1 Sample Question 149

Which of the following are the rights of the beneficiaries?

A. (i) & (ii)
B. (ii) & (iii)
C. (i) & (iii)
D. All of the above

ANSWER : D

GLO_CWM_LVL_1 Sample Question 150

A. Rs. 34,000, Rs. 10,000/-
B. Rs. 40,000/- Rs. 10,000
C. Rs. 40,000/-, Nil
D. Rs. 40,000/- Rs. 10,000

ANSWER : C

GLO_CWM_LVL_1 Sample Question 151

You are considering investing in a following bond:

A. 10.09%
B. 10.83%
C. 11.92%
D. 11.06%

ANSWER : D

GLO_CWM_LVL_1 Sample Question 152

A. Rs 1.05 lakh and Rs 4.95 lakh
B. Rs 70,000 and Rs 3.95 lakh
C. Rs 1.05 lakh and Rs 3.95 lakh
D. Rs 70,000 and Rs 4.30 lakh

ANSWER : C

GLO_CWM_LVL_1 Sample Question 153

Consider the following information for three mutual funds


Risk free return is 7%. Calculate Treynor measure?

A. 4.55, 8.89, 5.83
B. 3.25, 6.78, 4.65
C. 4.35, 7.78, 4.35
D. 3.75, 7.85, 5.78

ANSWER : A

GLO_CWM_LVL_1 Sample Question 154

A trust not created by a will can be revoked only

A. (i) & (ii)
B. (ii) & (iii)
C. (i) & (iii)
D. All of the above

ANSWER : D

GLO_CWM_LVL_1 Sample Question 155

Calculate the variance (%2) from the data given below:

A. 14.30 (%2)
B. 15.46 (%2)
C. 50.00 (%2)
D. 2.50 (%2)

ANSWER : D

GLO_CWM_LVL_1 Sample Question 156

Assume Manmeet has taken his flat on rent from 01/07/ 2011. On 01/07/2011 he has cash

in hand Rs.15000. What will be his cash in hand on 31/03/2012?

A. RS. 195000/-
B. Rs. 205000/
C. Rs. 185000/-
D. Rs. None of the above

ANSWER : B

GLO_CWM_LVL_1 Sample Question 157

The expected return and standard deviations of stock A & B are:

A. 3.5%, 15.5%
B. 8.8%, 7.03%
C. 20% , 14.5%
D. 9.8%, 15.6%

ANSWER : C

GLO_CWM_LVL_1 Sample Question 158

A. Rs. 2,10,000
B. Rs. 1,97,500
C. Rs. 1,93,500
D. Rs. 1,83,750

ANSWER : B

GLO_CWM_LVL_1 Sample Question 159

The Trust has spent Rs. 5,000/- per year for collection of the income. The value of life

interest of Re 1/- at the age of 40 is Rs. 10.093/-. The value of the property on the valuation

date is Rs. 5 lakh. Find the value of life interest.

A. Rs. 3.84 lakh
B. Rs. 3 lakh
C. Rs. 3.27 lakh
D. Rs. 5 lakh

ANSWER : A