Question 1

The federal government collects more revenue from the corporate income tax than from the individual income tax.

Accepted Answer

A) True 
 B)False  False

Question 2

Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

Accepted Answer

A)  Acme Inc. 
B)  Acme's customers. 
C)  Acme's employees. 
D)  Acme's shareholders. 
A)  Acme Inc. 
B)  Acme's customers. 
C)  Acme's employees. 
D)  Acme's shareholders. C

Question 3

The person who pays a tax directly to the government always bears the economic incidence of the tax.

Accepted Answer

A) True 
 B)False  False

Question 4

Which of the following federal taxes is not earmarked for a specific purpose?

Accepted Answer

A)  Employment taxes 
B)  Unemployment taxes 
C)  Transfer taxes 
D)  All of the above are earmarked taxes. 
A)  Employment taxes 
B)  Unemployment taxes 
C)  Transfer taxes 
D)  All of the above are earmarked taxes.

Question 5

A sales tax is an example of an activity-based tax.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following taxes is a significant source of revenue for local governments?

Accepted Answer

A)  Real property tax 
B)  Employment tax 
C)  Income tax 
D)  None of the above 
A)  Real property tax 
B)  Employment tax 
C)  Income tax 
D)  None of the above

Question 7

A sales tax can best be described as a(n):

Accepted Answer

A)  Consumption tax 
B)  Income tax 
C)  Activity tax 
D)  Ad valorem tax 
A)  Consumption tax 
B)  Income tax 
C)  Activity tax 
D)  Ad valorem tax

Question 8

Under U.S. tax law, corporations are entities separate and distinct from their shareholders.

Accepted Answer

A) True 
 B)False

Question 9

A revenue ruling is an example of:

Accepted Answer

A)  Judicial authority 
B)  Administrative authority 
C)  Legislative authority 
D)  Editorial authority 
A)  Judicial authority 
B)  Administrative authority 
C)  Legislative authority 
D)  Editorial authority

Question 10

The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Accepted Answer

A)  $10,230 
B)  $11,230 
C)  $11,730 
D)  None of the above 
A)  $10,230 
B)  $11,230 
C)  $11,730 
D)  None of the above

Question 11

Mr. Bilboa is a citizen of Portugal. Which of the following statements is true?

Accepted Answer

A)  The U.S. government has no jurisdiction to tax Mr. Bilboa because he is not a U.S. citizen. 
B)  The U.S. government has jurisdiction to tax Mr. Bilboa if he is a permanent resident of the United States. 
C)  The U.S. government has jurisdiction to tax Mr. Bilboa if he earns income from a business he operates in Florida. 
D)  Both B. and C. are true. 
A)  The U.S. government has no jurisdiction to tax Mr. Bilboa because he is not a U.S. citizen. 
B)  The U.S. government has jurisdiction to tax Mr. Bilboa if he is a permanent resident of the United States. 
C)  The U.S. government has jurisdiction to tax Mr. Bilboa if he earns income from a business he operates in Florida. 
D)  Both B. and C. are true.

Question 12

The U.S. government has jurisdiction to tax individuals who are not U.S. citizens but who are permanent U.S. residents.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is not characteristic of an excise tax?

Accepted Answer

A)  An excise tax is levied on the retail sale of specific goods. 
B)  Excise tax rates typically are higher than general sales tax rates. 
C)  Purchasers of luxury items are responsible for paying any excise tax directly to the government. 
D)  All of the above are characteristics of an excise tax. 
A)  An excise tax is levied on the retail sale of specific goods. 
B)  Excise tax rates typically are higher than general sales tax rates. 
C)  Purchasers of luxury items are responsible for paying any excise tax directly to the government. 
D)  All of the above are characteristics of an excise tax.

Question 14

The property tax on a rent house owned by Mr. Janey increased by $1,200 this year. Mr. Janey increased the monthly rent charged to his tenant, Ms. Lacey, by $45. Who bears the incidence of the property tax increase?

Accepted Answer

A)  Mr. Janey 
B)  Ms. Lacey 
C)  Both Mr. Janey and Ms. Lacey 
D)  Neither Mr. Janey nor Ms. Lacey 
A)  Mr. Janey 
B)  Ms. Lacey 
C)  Both Mr. Janey and Ms. Lacey 
D)  Neither Mr. Janey nor Ms. Lacey

Question 15

When did the federal income tax become a permanent tax?

Accepted Answer

A)  Immediately after the Revolutionary War 
B)  During the Civil War 
C)  In 1913 when the Sixteenth Amendment to the U.S. Constitution was ratified 
D)  In 1939 when Congress enacted the first Internal Revenue Code 
A)  Immediately after the Revolutionary War 
B)  During the Civil War 
C)  In 1913 when the Sixteenth Amendment to the U.S. Constitution was ratified 
D)  In 1939 when Congress enacted the first Internal Revenue Code

Question 16

Ad valorem property taxes are the major source of revenue for local governments.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following statements concerning sales taxes is false?

Accepted Answer

A)  Sales taxes apply to the purchase of most types of consumer goods. 
B)  Sales taxes apply to the purchase of most types of consumer services. 
C)  Sales taxes are collected by the seller when the sale is made. 
D)  Sales taxes imposed on the purchaser of retail items are consumption taxes. 
A)  Sales taxes apply to the purchase of most types of consumer goods. 
B)  Sales taxes apply to the purchase of most types of consumer services. 
C)  Sales taxes are collected by the seller when the sale is made. 
D)  Sales taxes imposed on the purchaser of retail items are consumption taxes.

Question 18

The Internal Revenue Code is written by the Internal Revenue Service.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is not characteristic of a tax?

Accepted Answer

A)  A tax is compulsory. 
B)  A tax is intended to punish unacceptable behavior. 
C)  A tax is levied by a government. 
D)  All of the above are characteristics of a tax. 
A)  A tax is compulsory. 
B)  A tax is intended to punish unacceptable behavior. 
C)  A tax is levied by a government. 
D)  All of the above are characteristics of a tax.

Question 20

SJF Inc., which has its corporate offices in Boise, Idaho, conducts business in Idaho, Oregon, California, and British Columbia, Canada. Which of the following statements is true?

Accepted Answer

A)  SJF must pay income tax only to Idaho and the United States. 
B)  SJF may be required to pay income tax to Idaho, Oregon, California, British Columbia, the United States, and Canada. 
C)  SJF must pay income tax only to Idaho, Oregon, California, and the United States. 
D)  SJF may be required to pay income tax to either the United States or to Canada, but not to both. 
A)  SJF must pay income tax only to Idaho and the United States. 
B)  SJF may be required to pay income tax to Idaho, Oregon, California, British Columbia, the United States, and Canada. 
C)  SJF must pay income tax only to Idaho, Oregon, California, and the United States. 
D)  SJF may be required to pay income tax to either the United States or to Canada, but not to both.

The federal government collects more revenue from the corporate income tax than from the individual income tax.

Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

The person who pays a tax directly to the government always bears the economic incidence of the tax.

Which of the following federal taxes is not earmarked for a specific purpose?

A sales tax is an example of an activity-based tax.

Which of the following taxes is a significant source of revenue for local governments?

A sales tax can best be described as a(n):

Under U.S. tax law, corporations are entities separate and distinct from their shareholders.

A revenue ruling is an example of:

The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Mr. Bilboa is a citizen of Portugal. Which of the following statements is true?

The U.S. government has jurisdiction to tax individuals who are not U.S. citizens but who are permanent U.S. residents.

Which of the following is not characteristic of an excise tax?

The property tax on a rent house owned by Mr. Janey increased by $1,200 this year. Mr. Janey increased the monthly rent charged to his tenant, Ms. Lacey, by $45. Who bears the incidence of the property tax increase?

When did the federal income tax become a permanent tax?

Ad valorem property taxes are the major source of revenue for local governments.

Which of the following statements concerning sales taxes is false?

The Internal Revenue Code is written by the Internal Revenue Service.

Which of the following is not characteristic of a tax?

SJF Inc., which has its corporate offices in Boise, Idaho, conducts business in Idaho, Oregon, California, and British Columbia, Canada. Which of the following statements is true?

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Compensation and Retirement Planning

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters

Exam 1: Taxes and Taxing Jurisdictions

The federal government collects more revenue from the corporate income tax than from the individual income tax.

Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

The person who pays a tax directly to the government always bears the economic incidence of the tax.

Which of the following federal taxes is not earmarked for a specific purpose?

A sales tax is an example of an activity-based tax.

Which of the following taxes is a significant source of revenue for local governments?

A sales tax can best be described as a(n):

Under U.S. tax law, corporations are entities separate and distinct from their shareholders.

A revenue ruling is an example of:

The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Mr. Bilboa is a citizen of Portugal. Which of the following statements is true?

The U.S. government has jurisdiction to tax individuals who are not U.S. citizens but who are permanent U.S. residents.

Which of the following is not characteristic of an excise tax?

The property tax on a rent house owned by Mr. Janey increased by $1,200 this year. Mr. Janey increased the monthly rent charged to his tenant, Ms. Lacey, by $45. Who bears the incidence of the property tax increase?

When did the federal income tax become a permanent tax?

Ad valorem property taxes are the major source of revenue for local governments.

Which of the following statements concerning sales taxes is false?

The Internal Revenue Code is written by the Internal Revenue Service.

Which of the following is not characteristic of a tax?

SJF Inc., which has its corporate offices in Boise, Idaho, conducts business in Idaho, Oregon, California, and British Columbia, Canada. Which of the following statements is true?

Policy Standards for a Good Tax

Taxes As Transaction Costs

Maxims of Income Tax Planning

Tax Research

Taxable Income From Business Operations

Property Acquisitions and Cost Recovery Deductions

Property Dispositions

Nontaxable Exchanges

Sole Proprietorships, Partnerships, Llcs, and S Corporations

The Corporate Taxpayer

The Choice of Business Entity

Jurisdictional Issues in Business Taxation

The Individual Tax Formula

Compensation and Retirement Planning

Investment and Personal Financial Planning

Tax Consequences of Personal Activities

The Tax Compliance Process

Filters