Question 1

Sellers of retail goods are responsible for collecting sales tax from their customers and remitting the tax to the state government.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following sources of tax law carries the most authority?

Accepted Answer

A)  Revenue procedure 
B)  Treasury regulation 
C)  Supreme Court decision 
D)  The three sources of tax law have equal authority 
A)  Revenue procedure 
B)  Treasury regulation 
C)  Supreme Court decision 
D)  The three sources of tax law have equal authority

Question 3

Which of the following sources of tax law carries the least authority?

Accepted Answer

A)  Revenue ruling 
B)  Treasury regulation 
C)  Section 736 of the Internal Revenue Code 
D)  The three sources of tax law have equal authority 
A)  Revenue ruling 
B)  Treasury regulation 
C)  Section 736 of the Internal Revenue Code 
D)  The three sources of tax law have equal authority

Question 4

Which of the following statements about sales and use taxes is true?

Accepted Answer

A)  If an individual pays a sales tax on the purchase of an item, she will not have to pay a use tax on the purchase. 
B)  An individual must pay both a sales tax and a use tax on the taxable purchase of an item. 
C)  Many states that impose a sales tax do not impose a complementary use tax. 
D)  None of the above is true. 
A)  If an individual pays a sales tax on the purchase of an item, she will not have to pay a use tax on the purchase. 
B)  An individual must pay both a sales tax and a use tax on the taxable purchase of an item. 
C)  Many states that impose a sales tax do not impose a complementary use tax. 
D)  None of the above is true.

Question 5

What is the major difference between a sales tax and an excise tax?

Accepted Answer

A)  Sales taxes are levied by state governments, while excise taxes are levied only by the federal government. 
B)  Sales taxes are imposed on the purchase of a wide variety of items, while excise taxes are imposed on the purchase of a few specific items. 
C)  Sales taxes must be collected by the seller, while excise taxes must be paid directly by the purchaser. 
D)  Sales taxes are imposed on the purchase of tangible goods, while excise taxes are imposed on the purchase of services. 
A)  Sales taxes are levied by state governments, while excise taxes are levied only by the federal government. 
B)  Sales taxes are imposed on the purchase of a wide variety of items, while excise taxes are imposed on the purchase of a few specific items. 
C)  Sales taxes must be collected by the seller, while excise taxes must be paid directly by the purchaser. 
D)  Sales taxes are imposed on the purchase of tangible goods, while excise taxes are imposed on the purchase of services.

Question 6

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.

Question 7

Mr. Dodd resides in a state with a 6% sales and use tax. He recently traveled to another state to buy a sailboat and paid that state's 4% sales tax. Which of the following statements is true?

Accepted Answer

A)  Mr. Dodd's use tax liability to his home state equals 2% of the purchase price of the furniture. 
B)  Mr. Dodd does not owe a use tax to his home state. 
C)  Mr. Dodd's use tax liability to his home state equals 6% of the purchase price of the furniture. 
D)  None of the above is true. 
A)  Mr. Dodd's use tax liability to his home state equals 2% of the purchase price of the furniture. 
B)  Mr. Dodd does not owe a use tax to his home state. 
C)  Mr. Dodd's use tax liability to his home state equals 6% of the purchase price of the furniture. 
D)  None of the above is true.

Question 8

A sales tax is an example of a transaction-based tax.

Accepted Answer

A) True 
 B)False

Question 9

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 10

Which of the following is an earmarked tax?

Accepted Answer

A)  A tax imposed on the purchase of specific items such as liquor or cigarettes 
B)  A tax that generates revenues that the government can spend only to build more National Parks 
C)  A tax imposed only on individuals who earn more than $1 million annually 
D)  A tax that generates revenues that the government can spend for any purpose 
A)  A tax imposed on the purchase of specific items such as liquor or cigarettes 
B)  A tax that generates revenues that the government can spend only to build more National Parks 
C)  A tax imposed only on individuals who earn more than $1 million annually 
D)  A tax that generates revenues that the government can spend for any purpose

Question 11

Businesses that sell over the internet must collect sales tax only from purchasers living in a state in which the business has a physical presence.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is not considered administrative authority?

Accepted Answer

A)  Treasury regulations 
B)  Revenue rulings 
C)  Tax Court decisions 
D)  All of the above are administrative authorities 
A)  Treasury regulations 
B)  Revenue rulings 
C)  Tax Court decisions 
D)  All of the above are administrative authorities

Question 13

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 14

The city of Mayfield charges individuals convicted of DWI (driving while intoxicated) $500 for the first conviction and $2,000 for any subsequent conviction. These charges are an example of a(n):

Accepted Answer

A)  User's fee 
B)  Transaction-based tax 
C)  Activity-based tax 
D)  Government penalty 
A)  User's fee 
B)  Transaction-based tax 
C)  Activity-based tax 
D)  Government penalty

Question 15

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 16

Mr. Smith resides in a state with a 6% sales and use tax. He recently traveled to another state to buy furniture and paid that state's 7% sales tax. Which of the following statements is true?

Accepted Answer

A)  Mr. Smith is entitled to a refund of 1% of the purchase price of the sailboat. 
B)  Mr. Smith does not owe a use tax to his home state. 
C)  Mr. Smith's use tax liability to his home state equals 6% of the purchase price of the sailboat. 
D)  None of the above is true. 
A)  Mr. Smith is entitled to a refund of 1% of the purchase price of the sailboat. 
B)  Mr. Smith does not owe a use tax to his home state. 
C)  Mr. Smith's use tax liability to his home state equals 6% of the purchase price of the sailboat. 
D)  None of the above is true.

Question 17

Which of the following characterizes a good tax base?

Accepted Answer

A)  The base can be easily expressed in monetary terms. 
B)  Taxpayers cannot easily avoid or conceal the base. 
C)  Taxpayers cannot easily move the base from one jurisdiction to another. 
D)  All of the above characterize a good tax base. 
A)  The base can be easily expressed in monetary terms. 
B)  Taxpayers cannot easily avoid or conceal the base. 
C)  Taxpayers cannot easily move the base from one jurisdiction to another. 
D)  All of the above characterize a good tax base.

Question 18

Company D, which has its home office in Raleigh, North Carolina, conducts business in the United States, Canada, and Mexico. Which of the following statements is true?

Accepted Answer

A)  Because Company D must pay income tax to North Carolina, it is not required to pay tax to any other state. 
B)  Because Company D must pay income tax to North Carolina, it is not required to pay federal income tax. 
C)  Because Company D must pay income tax to the United States, it is not required to pay tax to Canada or Mexico. 
D)  None of the above is true. 
A)  Because Company D must pay income tax to North Carolina, it is not required to pay tax to any other state. 
B)  Because Company D must pay income tax to North Carolina, it is not required to pay federal income tax. 
C)  Because Company D must pay income tax to the United States, it is not required to pay tax to Canada or Mexico. 
D)  None of the above is true.

Question 19

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 20

Payment of a tax entitles the payer to a specific good or service from the government.

Accepted Answer

A) True 
 B)False

Sellers of retail goods are responsible for collecting sales tax from their customers and remitting the tax to the state government.

Which of the following sources of tax law carries the most authority?

Which of the following sources of tax law carries the least authority?

Which of the following statements about sales and use taxes is true?

What is the major difference between a sales tax and an excise 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?

Mr. Dodd resides in a state with a 6% sales and use tax. He recently traveled to another state to buy a sailboat and paid that state's 4% sales tax. Which of the following statements is true?

A sales tax is an example of a transaction-based tax.

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

Which of the following is an earmarked tax?

Businesses that sell over the internet must collect sales tax only from purchasers living in a state in which the business has a physical presence.

Which of the following is not considered administrative authority?

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

The city of Mayfield charges individuals convicted of DWI (driving while intoxicated) $500 for the first conviction and $2,000 for any subsequent conviction. These charges are an example of a(n):

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

Mr. Smith resides in a state with a 6% sales and use tax. He recently traveled to another state to buy furniture and paid that state's 7% sales tax. Which of the following statements is true?

Which of the following characterizes a good tax base?

Company D, which has its home office in Raleigh, North Carolina, conducts business in the United States, Canada, and Mexico. Which of the following statements is true?

A revenue ruling is an example of:

Payment of a tax entitles the payer to a specific good or service from the government.

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

Sellers of retail goods are responsible for collecting sales tax from their customers and remitting the tax to the state government.

Which of the following sources of tax law carries the most authority?

Which of the following sources of tax law carries the least authority?

Which of the following statements about sales and use taxes is true?

What is the major difference between a sales tax and an excise 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?

Mr. Dodd resides in a state with a 6% sales and use tax. He recently traveled to another state to buy a sailboat and paid that state's 4% sales tax. Which of the following statements is true?

A sales tax is an example of a transaction-based tax.

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

Which of the following is an earmarked tax?

Businesses that sell over the internet must collect sales tax only from purchasers living in a state in which the business has a physical presence.

Which of the following is not considered administrative authority?

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

The city of Mayfield charges individuals convicted of DWI (driving while intoxicated) $500 for the first conviction and $2,000 for any subsequent conviction. These charges are an example of a(n):

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

Mr. Smith resides in a state with a 6% sales and use tax. He recently traveled to another state to buy furniture and paid that state's 7% sales tax. Which of the following statements is true?

Which of the following characterizes a good tax base?

Company D, which has its home office in Raleigh, North Carolina, conducts business in the United States, Canada, and Mexico. Which of the following statements is true?

A revenue ruling is an example of:

Payment of a tax entitles the payer to a specific good or service from the government.

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