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easyMCQCUET 2025 31 May Shift 12026CUET Accountancy
1 mark

Provident Fund (PF) is calculated as a percentage of which component(s)?

  1. A
    Only Dearness Allowance
  2. B
    \text{Basic Pay + Dearness Pay (if applicable)}
  3. C
    \text{Grade Pay + House Rent Allowance}
  4. D
    Transport Allowance only

Solution & Step-by-step Explanation

In standardized salary and payroll accounting structures, statutory deductions like the Provident Fund (PF) are computed as a fixed percentage rate applied to the combination of the employee's Basic Pay and Dearness Pay / Dearness Allowance (where terms of employment allow).

Practice this question

Try it yourself before checking the explanation above.

Provident Fund (PF) is calculated as a percentage of which component(s)?
A
Only Dearness Allowance
B
\text{Basic Pay + Dearness Pay (if applicable)}
C
\text{Grade Pay + House Rent Allowance}
D
Transport Allowance only

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