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FPSBI/M-VI/03-01/10/SP-23

Case Study: Ms. Irawati Senna (Reference Date: 20th March 2010)
Ms. Irawati Senna, aged 42 years, having twins Rishi and Sonali of age 12 years, is an Executive Director in a
private bank based in Mumbai. She has been recently divorced by industrialist Mr. Chiranjib Bajaj. The court
judgment has given Irawati the custody of children and a maintenance compensation of Rs. 17,726,500, of
which a sum of Rs. 75 lakh per child has to be dedicatedly used for education and professional development
through separately monitored bank accounts. Irawati has no residence of her own. She is currently residing in
a rented house. Both her children study in the 6th Standard in an International School. She has approached
you, a CFPCM practitioner, for preparing a financial plan for her family. She has shared the following financial
information with you:
Financial Assets: Current Market Value (Rs. lakh)
Equity Mutual Fund portfolio : 26.47
Balanced MF scheme investment : 9.78
Demat Account - listed equity shares1 : 25.92
Demat Account - Nifty ETF units2 : 3.27
Demat Account - Gold ETF units3 : 3.13
PPF A/c. (maturing 1st April 2016)4 : 6.59
1
Total cost Rs. 15 lakh. Last purchase made in May, 2008.
2
Invested Rs. 65,000 a year ago.
3
Invested Rs. 1.86 lakh three years ago in the NFO of Gold ETF.
4
Balance as on 31st March 2009 and Rs. 70,000 contributed on 25th April 2009
Deposits: Current Balances (Rs. lakh)
Bank Salary Account : 2.82
Bank Account – Rishi : 75.00
Bank account – Sonali : 75.00
Bank account – Irawati : 27.26
Deposit with landlord : 3.00
Other Assets: Current Disposable Value (Rs. lakh)
Gold & Diamond Jewellery : 15.75
Physical Gold (coins/bars) : 11.25
Car : 7.50
Liabilities: Currently Outstanding (Rs. lakh)
Car loan : 6.41
Credit Cards : 0.72
Salary Income: Annual (Rs. lakh)
Basic Salary : 36.00
HRA : 6.00
Conveyance Allowance : 1.50
Variable Salary : 7.50
Regular Outgoings: Monthly (Rs.)
Basic Household Expenses : 47,000
Services availed : 12,500
School Fees : 25,000
House Rent : 50,000
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Power, Telecom & Fuel : 12,500


Car Loan EMI : 22,654

Cash outflows: Annual (Rs.)


Insurance Premium (Term Plan)5 : 58,759
Health Insurance Premium6 : 27,631
5
(Annual – 3 policies/ Total Cover Rs. 1.45 crore)
6
(Annual – 2 policies/ Total cover Rs. 20 lakh)
You, in consultation with Irawati, have crystallized the following financial goals for her family and the
preliminary Roadmap to achieve them:
1. Send both the Children to a Boarding School – Immediately – Outlay Rs. 4.80 lakh per child per annum
– for 6 years – To be met on year to year basis by investing a suitable corpus today.
2. Buy a house – within one year – Outlay of Rs. 75 lakh – Take a loan for 15-year term.
3. Send both Children for Higher Education abroad – After 6 years – Outlay (estimated) Rs. 1.20 crore
then for each child for 5 years – To be met by suitably investing the dedicated amounts received out
of divorce settlement in an investment vehicle to accumulate the desired Corpus in 6 years.
4. Retirement Corpus – To be accumulated in 18 years – Corpus to sustain an annuity of Rs. 1.6 lakh per
month (in the first month post-retirement) and thereafter inflation adjusted for 25 years
post-retirement – To be met by suitably investing divorce proceeds (reserved for her) as well as linking
all her mutual fund scheme holdings.
5. A World Tour for 3 months with both her kids when she attains 53 years of age – Outlay of Rs. 20 lakh
at current prices – To be met out of her PPF A/c maturity, given that she would contribute maximum
permissible amount annually on the 1st working day of April till its due maturity as well as in all years
during its first extension. The cost of escalation of such expenses is assumed at 6% p.a.
6. A suitable Estate Planning to cover all her physical and financial assets.
Assumptions regarding long-term pre-tax returns on various asset classes:
1. Equity & Equity MF schemes/ Index ETFs : 11.00% p.a.
2. Balanced MF schemes : 9.00% p.a.
3. Bonds/Govt. Securities/Debt MF schemes : 7.00% p.a.
4. Liquid MF schemes : 5.50% p.a.
5. Gold & Gold ETF : 7.50% p.a.
Assumptions regarding economic factors:
1. Inflation : 5.50% p.a.
2. Expected return in Risk free instruments : 6.50% p.a.
3. Real Estate appreciation : 8.00% p.a.

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Questions:
1) Irawati believes that a CERTIFIED FINANCIAL PLANNERCM practitioner is able to take care of the
execution of all aspects of her Financial Plan, i.e. Taxation, Insurance, Investments, etc. As per FPSB
India Code of Ethics, what is the best proposition in this context? (2)
A) This is the right assumption which can be made about all CERTIFIED FINANCIAL PLANNERCM
professionals.
B) The scope and limitations of the services of the CERTIFIED FINANCIAL PLANNERCM practitioner
needs to be disclosed in the beginning, specifically in writing, by the practitioner to the client.
C) A CERTIFIED FINANCIAL PLANNERCM practitioner can never take care of all aspects of a Financial
Plan.
D) A CERTIFIED FINANCIAL PLANNERCM practitioner is concerned with only making a Financial Plan
and not its execution.
2) Recently a nationalized bank announced a nominal interest rate of 9.00% per annum on 600-day bank
FDR (compounding quarterly). Irawati wants to invest in this product and seeks your advice. You
compute the pre-tax real rate of return to assess the viability of this product. The same is: (2)
A) 3.61% p.a
B) 3.32% p.a
C) 3.81% p.a
D) 3.50% p.a
3) Irawati plans to pay off her loan after paying 5 more installments. She took a loan of Rs. 749,750 for
40 months at 11.5% p.a. on reducing monthly balance basis in August, 2009. The first EMI was paid on
1st September 2009 and thereafter on every 1st of the month. Prepayment of car loan would attract a
penalty of 4% on the outstanding liability. What amount is required to prepay the loan with
penalty?(Please ignore any other charges and taxes if applicable) (4)
A) Rs. 5,58,142
B) Rs. 5,54,020
C) Rs. 5,94,048
D) Rs. 5,76,181
4) Irawati told you that her ex-husband had purchased a life insurance policy under the MWP Act, 1874
prior to their divorce. The beneficiaries of the policy are Irawati and their two children. Irawati wants
to know the significance and the benefits of this policy.
1) No alterations can be made by the husband once the policy is commenced
2) The proceeds of such a policy cannot be claimed by the husband or his creditors or form part of
the husband’s estate
3) Alterations can be made by the wife once the policy is effected
4) The life assured is the wife (2)
A) 1, 2, 4
B) 1, 2
C) 2
D) 1, 4
5) Irawati wants to know the importance of waiver of premium rider? You tell her that _______. (2)
A) It is useless as there will not be any amount to be received from the Insurance Company at the
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B) It is very useful as all future premiums would be waived by the Insurance Company in case the Life
Assured becomes totally and permanently disabled
C) It is same as Permanent Disablement rider hence need not be mentioned separately
D) It is inbuilt with all the Term Insurance plans and thus need not be mentioned separately

6) Irawati proposes to invest in an upcoming housing project in suburban Mumbai for a flat worth Rs.
7,500,000 today. She proposes to make the down payment of Rs. 500,000 immediately. The balance
amount is to be paid in installments to the builder, 15% of the balance amount on 1st April 2010, 30%
on 1st September 2010, 30% on 1st December 2010 and balance on 1st April 2011. In the meanwhile,
she has researched on the various housing loan schemes offered by banks. She has finalised on one of
the Banks that provides the loan at fixed interest of 10.5% p.a. disbursable as per time schedule
agreed with the builder. The tenure of the loan is 15 years from the date of disbursement of first
installment and she pays the first EMI on 1st May 2010. She wants to know, what would be final EMI
payable after the full disbursement of loan amount? (4)
A) Rs. 84,301
B) Rs. 78,740
C) Rs. 78,681
D) Rs. 77,377
7) Irawati wants to invest for her retirement corpus as per her goal. In this connection, you suggest her
to transfer her share of divorce settlement to a suitable liquid fund and also utilize her current holding
in Equity Mutual Fund scheme and Balanced Mutual Fund scheme, while investing every month to the
extent of Rs. 30,000 in Equity scheme and Rs. 10,000 in Balanced MF scheme from the liquid fund
from today. After this arrangement is over, the money invested would continue to appreciate in these
separate schemes till her proposed retirement and the combined corpus is expected to suffer a tax
incidence of 4%. She wants to know, how long post-retirement this corpus would sustain to give her
the desired annuity, if the same is invested in risk free instruments (Consider tax on capital gains
applicable for monthly withdrawals from liquid funds is paid separately by Irawati) (5)
A) Approx 20 years
B) Approx 21 years
C) Approx 19 years
D) Approx 18 years
8) Irawati also wants to know what would be the additional investment yield, over and above risk-free
return required for the retirement corpus of Rs. 3.4 crore to sustain till her proposed post-retirement
period while providing her an inflation-linked monthly annuity of Rs. 1.6 lakh. (3)
A) 8.66% p.a.
B) 2.16% p.a.
C) 3.19% p.a.
D) 2.99% p.a.
9) Irawati had earlier received calls from certain institutions offering free services of Financial Planning
through their Financial Planners by subscribing to their financial products and services. She asks you
the features of CERTIFIED FINANCIAL PLANNERCM practitioner that distinguishes you from other
financial planners. You tell her that__________
(I) CFPCM practitioner has to go through an internationally accepted curriculum framework and meet
the given competency profile
(II) A CFPCM practitioner, once certified can follow any institution’s guidelines of Financial Planning
without any recourse to FPSB India
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(III) CFPCM practitioner has to meet stringent initial certification standards and continuing education to
remain certified
(IV) CFPCM practitioner has to abide by FPSB India’s Code of Ethics and professional guidelines
(V) A CFPCM certificant has to necessarily do a fee-based Financial Planning
Which of the above are correct? (2)
A) (II) and (V) only
B) (I), (III) and (IV) only
C) (I) and (II) only
D) (I) and (IV) only
10) Irawati wants to go on a world tour with her children when she attains 53 years of age. The funds will
be met out of proceeds received from her PPF A/c. after extension for a term of 5 years. What will be
the shortfall in funds for her proposed goal? (4)
A) Rs. 7.52 lakh
B) Rs. 7.03 lakh
C) Rs. 5.11 lakh
D) Rs. 8.79 lakh
11) Irawati wants to know the total amount to be invested for her children’s boarding school education.
She intends to meet the admission fees and first year charges by selling Gold coins/ bars. The cost of
boarding school would escalate @6% p.a. You advice to use the money invested in equity shares, Gold
ETF and Nifty ETF and put the net of tax proceeds in a Nifty Index MF scheme immediately. What
money per month she should invest in the same Index Fund till she makes the payment of admission
fees of second year to achieve the goal. (Ignore applicable education cess) (5)
A) Rs. 83,621
B) Rs. 84,731
C) Rs. 87,020
D) Rs. 76,377
12) Irawati wishes to utilize the combined dedicated funds for her children’s education, received as
divorce settlement, for their higher education abroad. She wants to take Equity risk selectively to
accumulate the desired sums when due. You advise her to invest Rs. 30 lakh in Nifty Index fund of a
Mutual Fund immediately and invest the remaining in a Fixed Maturity Plan (FMP) of Mutual Funds of
1 year tenure. Currently, the approximate post-tax yield in the dividend reinvestment option of such
plans is 6.75%. You suggest her to shift an amount of Rs. 30 lakh from FMP to Nifty Index Fund in the
2nd Year as well as in the 3rd year. However, an amount of Rs. 30 lakh is shifted back from Nifty Index
Fund to FMP in the 4th year as well as in the 5th year. In the 6th year, the entire amount is invested only
in FMP. You estimate, considering a steady performance in these asset classes during the period,
excess/ shortfall in meeting the goal. You find the same as_______. (5)
A) Shortfall Rs. 18 lakh
B) Shortfall Rs. 1 lakh
C) Shortfall Rs. 16 lakh
D) Shortfall Rs. 4 lakh
13) Irawati wants to create a private trust in the name of her children. According to you, which of the
following are true in case of a private trust
(I) A trustee shall be any known person capable of holding property
(II) A trust has to be declared by a non – testamentary instrument in writing , signed and registered or
by the will of the author of the trust or of the trustee in case of an immovable property
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(III) A trustee would be taxed in his hands in a representative capacity where the beneficiary is a
minor, lunatic or idiot or specifically entitled to receive the income from the trust
(IV) The author of the trust can be the trustee himself (2)
A) (III) and (IV)
B) (II) and (III)
C) (II), (III) and (IV)
D) (I), (II) and (IV)
14) Irawati wants to invest in NSC after 6 months in the name of Rishi and Sonali. She wants to know the
taxability of interest accrued and the maturity amount on NSC. (Assume tax provisions of FY 2009-10
would prevail) (3)
A) Will not be taxed they as they are minors
B) Would be clubbed with Irawati’s income in the year in which interest accrues and would be
eligible to deduction under section 80C, the maturity amount would be exempt from tax
C) Would be clubbed with Irawati’s income in the year in which interest accrues and would not be
eligible for deduction under section 80C, the maturity amount would be exempt from tax
D) The children would taxed on interest earned at the time of maturity of NSC
15) Irawati wants to know her tax liability on income from capital gains for the financial year 2009-10 if
she sells her entire listed equity shares, Nifty ETF and Gold ETF. Additionally, she also sells gold coins
amounting to Rs. 200,000. The Gold coins were gifted to Irawati on the occasion of her marriage on 26
December 1993. The cost of such Gold coins was Rs. 45,250 at the time of purchase. (C.I.I: 1992-93 :
223, 1993-94 : 244, 2000-01 : 406, 1999-00 : 389, 2009-10 : 632) (Ignore education cess) (5)
A) Rs. 41,275
B) Rs. 29,259
C) Rs. 28,575
D) Rs. 44,450

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Case: Ravi Mohan (Reference date: 20th March, 2010)


Ravi Mohan, aged 29 years, working with a Life Insurance company since December 2004, has approached you
for preparing his Financial Plan. He is staying in his own house at Surat. His wife Abhilasha, aged 28 years, is in
the small business of manufacturing garments from which she has earned a net profit of Rs. 3 Lakh in FY 2008-
09.The couple has a son, Akhil of age one year. The couple plans no further kid in future. Ravi is also
supporting his parents staying in Valsad to whom he sends Rs. 9,000 p.m. His monthly house hold expenses
are Rs. 20,000 p.m. apart from payment of insurance premium and loan EMI. Ravi expects 5% increase in his
gross salary year on year in the beginning of financial year.
Ravi Mohan’s monthly salary
1. Basic Salary Rs. 36,000^

2. D. A (forming part of Salary) 50% of basic salary

3. House Rent allowance Rs. 10,000

3. Transport Allowance Rs. 3,000

4. Children Education Allowance Rs.1,000 per child

6. Medical Reimbursement Rs. 4,000

7. Entertainment Allowance Rs. 3,000

^ 12% of Basic is contributed towards Employees’ Provident Fund


Couple’s Current Assets & Liabilities (as on date unless otherwise specified in the footnotes)
House : Rs.30.00 lakh
Car : Rs. 3.50 lakh
Cash/Bank Balance : Rs. 0.75 lakh
PPF Account 1 : Rs. 0.90 lakh
Children Plan from a life insurer2 : Rs. 2.50 lakh (Sum Assured)
Money Back life insurance policy3 : Rs. 2.00 lakh (Sum Assured)
ULIP policy : Rs. 3.00 lakh (Premium Paid)
Medical insurance4 : Rs. 5.00 lakh (Sum Assured)
Gold ornaments : Rs. 8.50 lakh
Equity Mutual Fund scheme : Rs. 2.85 lakh
Balanced Mutual Fund scheme : Rs. 1.25 lakh
Shares of XYZ Ltd.5 : Rs. 0.95 lakh
Equity Linked Saving Scheme : Rs. 1.75 lakh
National Saving Certificate : Rs. 0.30 lakh (principal amount)
1
Balance on 31st March, 2009, Account matures on 1st April, 2017)
2
for which he pays premium of Rs. 26,821
3
for which he pays premium of Rs. 14,000
4
for which he pays a premium of Rs. 15,000 per annum
5
10,000 Shares of face value Rs. 10.00 per share
Liabilities
Home loan6 : Rs. 6.00 lakh (Principal amount)
Car Loan7 : Rs. 4.00 lakh (Principal amount)

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Home loan of Rs. 6 Lakh taken on 1st August, 2006 at a fixed interest of 8.5% p.a., for a 20-year term.
7
Car loan of Rs. 4 Lakh taken on 1st April, 2008 at a fixed interest of 11.25% p.a. for a 5-year term.
Goals
• To provide for higher education of Akhil. Expenses of Rs. 2.5 lakh p.a. (current cost) for three years of
Graduation starting at the age of 18 years, Rs. 5 lakh p.a. (current cost) for two years of post-
graduation thereafter.
• Marriage expenses of Rs. 15 lakh (current cost) four years after completing post graduation.
• Build a retirement corpus to start an annuity from Ravi’s age of 60 years onwards
• A Bigger house valued at Rs. 30 lakh today in the next 6 years
• To build a separate fund for vacation expenses Rs.50,000 every year for the next 10 years
Life Parameters
Ravi’s expected life : 75 years
Abhilasha’s expected life : 80 years

Assumptions regarding long-term pre-tax returns on various asset classes:


1. Equity & Equity MF schemes /Index ETFs : 11.00% p.a.
2. Balanced MF schemes : 9.00% p.a.
3. Bonds/Govt. Securities/Debt MF schemes : 7.00% p.a.
4. Liquid MF schemes : 5.50% p.a.
5. Gold & Gold ETF : 7.50% p.a.

Assumptions regarding economic factors:

1. Inflation : 5.50% p.a.


2. Risk free rate : 6.50% p.a.
3. Real Estate appreciation : 8.00% p.a.

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Questions
16) Before beginning work on Ravi’s Financial Plan, you have drafted a “Letter of Engagement” and sought
Ravi’s consent on the same. Ravi asked you about relevance of such a letter. In the context of Financial
Planning profession, you explain about the “Letter of Engagement” as a _________. (2)
A) professional requirement under Code of Ethics of FPSB India
B) professional requirement under Practice Guidelines of FPSB India
C) necessary legal requirement as per Contract Act 1872
D) document for his personal record

17) Ravi intends to build a retirement corpus through the Balanced Mutual Fund scheme in which he is
already investing since October, 2008 an amount of Rs. 5,000 p.m. on 1st of every month by way of a
Systematic Investment Plan (SIP). The SIP would continue till September, 2013. He plans to increase the
SIP amount to Rs. 7,500 p.m. from 1st October, 2013 in the same scheme till his age of 55 years, but
investment is retained up to 59 years. You estimate the sufficiency of corpus so accumulated at age 59
considering that they would require 70% of pre-retirement house hold expenses from Ravi’s age of 60
onwards in a monthly mode and inflation-linked till Abhilasha’s life span. You consider 10% capital gains
tax on the corpus to be accumulated and estimate excess/shortfall of corpus at Ravi’s age of 59, when
the same in withdrawn and invested in an investment instrument yielding 6.5% p.a. post-tax. The same
comes to _______. (5)
A) Rs. 40 lakh, shortfall
B) Rs. 50 lakh, shortfall
C) Rs. 73 lakh, shortfall
D) Rs. 33 lakh, shortfall
18) The construction of Ravi’s house was completed on 1st April 2008. He started paying EMIs after that, the
first EMI was paid on 1st May 2008. Prior to 31st March 2008, Ravi paid only the interest on his loan
which was disbursed in full by the bank on 1st Aug 2006, when the construction started. He wants to
know the interest portion allowable as deduction under section 24 of the Income Tax Act for the AY
2010-11. (4)
A) Rs. 49,487
B) Rs. 66,195
C) Rs. 67,542
D) Rs. 1,50,000
19) Ravi purchased 7,000 units of an Equity Mutual Fund scheme @Rs. 50 per unit on 2nd April, 2009. The
scheme declared a dividend of Rs. 10 per unit, the record date for the dividend was 15th June, 2009. Ravi
sold 1,000 units on 5th March, 2010 at Rs. 46 per unit. He wants to know the amount of short term
capital loss he can claim in AY 2010-11? (3)
A) He gets short Term Capital Gains of Rs. 14,000
B) He gets Short Term Capital Gains of Rs. 6,000
C) He can claim Short Term Capital Loss of Rs. 4,000
D) He cannot claim any Short Term Loss for Tax computation
20) Ravi, who is a Hindu, wants to know according to which Act his father’s estate would be distributed in
case he dies Intestate. (2)
A) Hindu Succession Act, 1956
B) Indian Contract Act
C) Indian Succession Act, 1925
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D) Transfer of Property Act


21) For the purpose of his child’s education and marriage, Ravi wants to start investing immediately on a
monthly basis in a Balanced MF scheme so as to withdraw for the first time at his son’s age of 18 years.
The monthly investments will continue till Akhil completes his graduation. What amount should he
invest every month to achieve the same? (Please ignore fraction of the year for calculation and also
ignore charges and taxes if applicable) (5)
A) Rs. 13,685
B) Rs. 13,871
C) Rs. 14,421
D) Rs. 12,450
22) Ravi wants to invest Rs. 2 Lakh in 390 days Bank fixed deposit yielding 9% p.a., which also attracts tax on
such interest @30%. From Tax Planning perspective, you advise him to invest a fixed sum into the
‘Growth’ option of a Fixed Maturity Plan (FMP) of a Mutual Fund, more than one year term, and
expected to yield same pre-tax return as the Bank fixed deposit. Ravi wants to know the tax advantage
to him, if investment is done in the FMP of Mutual Fund vis-à-vis the Bank fixed deposit. (Please ignore
cess, and assume Income Tax provisions of AY 2010-11 are applicable) (3)
A) Tax advantage to the extent of 20.00% is possible on income/gains.
B) Tax advantage to the extent of 10.00% is possible on income/gains.
C) Tax advantage to the extent of 12.50% is possible on income/gains.
D) There is no apparent Tax advantage in FMP vis-à-vis the Bank fixed deposit.
23) Ravi wants to know what the most appropriate instrument is/are to replicate exactly the equity market
returns over a sufficiently long period with the least cost and risks.
(i) Diversified Growth schemes of Mutual Funds
(ii) Equity Index Funds
(iii) Growth Option of ULIPs
(iv) Exchange Traded Funds of Equity Indices
(v) A portfolio of Large Capitalized stocks (3)
A) (i) and (ii)
B) (ii) and (iv)
C) (i) and (iii)
D) (iv) and (v)
24) Ravi saw the acronym CFPCM against your name in your business card. He wants to know about the
same. You tell him that ________. (3)
A) CFP marks are owned outside the US by US based FPSB Ltd
B) FPSB India is the owner of CFP marks within Indian territory
C) The US based FPSB Ltd. is licensed globally to administer CFP marks
D) The US based FPSB Ltd. and FPSB India are respectively licensed to issue CFP certification in US and
India
25) Ravi invested in shares of XYZ ltd on 12th October 2006 Rs. 3.50 below its Face Value. He received
dividends of Rs. 0.30 per share, Rs. 0.50 per share on 8th December 2007 and 30th November 2008
respectively. If he sells the entire holding of shares at the prevailing market price, what returns would he
have got from this transaction? (3)
A) 15.01% p.a.
B) 17.40% p.a.

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C) 11.54% p.a.
D) 16.60% p.a.
26) Ravi has been receiving job offers from competing Life Insurance companies and plans to resign from
the present company by the begin of April 2010. Ravi wants to know whether he is eligible for Gratuity
under the Payment of Gratuity Act, 1972 and what shall be the Gratuity payable in his case? (Assume his
present organization is covered under Payment of Gratuity Act, 1972) (3)
A) No, he is not eligible for Gratuity
B) Yes, Rs. 1,55,770
C) Yes, Rs. 1,03,850
D) Yes, Rs. 3,50,000
27) Ravi plans to invest regularly from FY 2010-11 on a quarterly basis an amount of Rs. 3,000 in his PPF A/c
till its maturity. The amounts are proposed to be invested in the first five days of April, July, October and
January every year. For FY 2009-10, he would invest Rs. 3,000 before the end of the financial year. Ravi
wants to know the approximate maturity amount of his PPF A/c. The same would be _______. (3)
A) Rs. 2.84 lakh
B) Rs. 2.79 lakh
C) Rs. 2.87 lakh
D) Rs. 2.73 lakh
28) Ravi wants to make a Will and understand its procedures; you explained that the ________ is the person
responsible for offering the Will for probate. (2)
A) Testator
B) Executor
C) Lawyer
D) Beneficiary
29) Ravi wants to know how much approximately he should be covered with life insurance, if he wants to
provide Abhilasha throughout her life time an amount equal to 80% of their present household
expenses inflation linked. Assume that the proceeds of such claim would be invested in a risk free
investment by her. (Please ignore taxes and charges if applicable) (4)
A) Rs. 125 Lakh
B) Rs. 80 Lakh
C) Rs. 30 Lakh
D) Rs. 90 Lakh
30) Ravi wants to know his Income tax liability on his Salary Income for the Financial Year 2009-10. (Assume
he is eligible for deduction u/s 24 to the extent of Rs. 60,000 and he has no other taxable Income in
financial year 2009-10) (5)
A) Rs. 1,17,170
B) Rs. 1,13,760
C) Rs. 1,21,810
D) Rs. 1,04,810

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