Accounting Tax Chapters 1-4 (Mcgraw-Hill) Exam Questions And Answers 2024

Accounting Tax Chapters 1-4 (Mcgraw-Hill) Exam Questions And Answers 2024Who cares about taxes? - correct answer-Businesses, Politicians,individuals Tax - correct answer-A payment required by a government agency that is unrelated to any specific benefit or service received from the government agency Tax Rate - correct answer-level of taxes imposed on the tax base and is usually expressed as a percentage Tax Base - correct answer-defines what is actually taxed and is usually expressed in monetary terms Formula for calculating tax - correct answer-Tax= Tax Base X Tax rate 3 different ways to measure tax rates - correct answer-Marginal Tax Rate, Average Tax Rate, Effective Tax Rate marginal tax rate - correct answer-the tax rate that applies to the next additional increment of a taxpayers taxable income average tax rate - correct answer-the taxpayers average level of taxation on each dollar of taxable income effective tax rate - correct answer-the taxpayers average rate of taxation on each dollar of total income (both taxable and non-taxable) average tax rate = - correct answer-total tax / taxable income effective tax rate = - correct answer-total tax / total income graduated taxes - correct answer-the base is divided into a serious of monetary accounts, or brackets, a portion of the tax base is subject to a specific tax rate 3 tax rate structures - correct answer-flat tax, progressive tax, regressive tax flat tax rate (proportional tax rate) - correct answer-imposes a constant tax rate throughout the tax base progressive tax rate - correct answer-imposes an increasing marginal tax rate as the tax base increases regressive tax rate - correct answer-imposes a decreasing marginal tax rate as the tax base increases types of federal taxes - correct answer-income taxes, employment and unemployment taxes, excise taxes, and transfer taxes income tax - correct answer-federal tax used to cover government programs employment and unemployment tax - correct answer-federal tax used to fund social security, medicare, and unemployment payments excise tax - correct answer-federal tax that is the quantity of product sold (alcohol, gasoline) transfer tax - correct answer-federal tax against transfers of wealth (estate taxes, gift taxes) types of state and local taxes - correct answer-sales and use, property, income sales and use tax - correct answer-state and local tax used for retail sales made in and out of the state property tax - correct answer-state and local tax on real and personal property income tax - correct answer-state and local tax used to fund state govt programs indirect tax (implicit tax) - correct answer-a tax not paid directly to the government implicit tax - correct answer-indirect taxes that result from a tax advantage the govt grants to certain transactions to satisfy social, economic , or other objectives excluded income - correct answer-income never included in taxable income deferred income - correct answer-income included in a subsequent tax year tax exempt = - correct answer-no tax tax deferred = - correct answer-no tax in current year capital assets - correct answer-generally all assets the US uses what type of tax rate schedule? - correct answer-progressive tax prepayments - correct answer-payments already made towards tax liability