Sage. 50 - Ch. 2 Review Questions with
complete solutions already passed
The Goods and Services Tax or GST is applied -
A) to all goods and services sold in Canada
B) only to merchandise sold in Canada
C) to all goods and services except food and medicine
D) to most goods and services sold in Canada - correct answer ✔✔D) to most goods and services sold in
Canada
Businesses must register for GST and apply GST to sales if -
A) they sell to customers in Canada
B) they have annual sales over $30 000
C) they import goods from outside of Canada
D) all businesses in Canada must register for GST - correct answer ✔✔B) they have annual sales over $30
000
Registration for GST favours a business because -
A) it increases revenue as customers pay more for the products and services
B) it makes the tax reports easier to prepare
C) it allows a business credits for the GST it pays for business-related expenses
D) there are no advantages to registering for GST - correct answer ✔✔C) it allows a business credits for
the GST it pays for business-related expenses
Items that are not taxable for GST -
, A) are mostly basic necessities
B) are consumed in Canada
C) are not used or needed by most Canadians
D) there are no items that do not have GST applied - correct answer ✔✔A) are mostly basic necessities
A business that is registered to collect PST from customers -
A) deducts the PST it pays on business-related expenses from the PST it remits to the provincial
government
B) does not pay PST on any business-related expenses
C) pays PST on most goods and services, just like GST
D) pays PST on taxable merchandise that it does not resell - correct answer ✔✔D) pays PST on taxable
merchandise that it does not resell
HST (Harmonized Sales Tax) differs from GST in that -
A) it has a different tax rate
B) it includes a portion for provincial sales tax
C) it applies to a different set of products and services
D) a and b above - correct answer ✔✔D) a and b above
Provincial sales taxes -
A) apply at the same rate in all provinces and territories in Canada
B) are always calculated on the sales amount before any other taxes are added
C) on purchases are treated as business expenses
D) increase revenue for a business by the amount of the tax collected from customers - correct answer
✔✔C) on purchases are treated as business expenses
complete solutions already passed
The Goods and Services Tax or GST is applied -
A) to all goods and services sold in Canada
B) only to merchandise sold in Canada
C) to all goods and services except food and medicine
D) to most goods and services sold in Canada - correct answer ✔✔D) to most goods and services sold in
Canada
Businesses must register for GST and apply GST to sales if -
A) they sell to customers in Canada
B) they have annual sales over $30 000
C) they import goods from outside of Canada
D) all businesses in Canada must register for GST - correct answer ✔✔B) they have annual sales over $30
000
Registration for GST favours a business because -
A) it increases revenue as customers pay more for the products and services
B) it makes the tax reports easier to prepare
C) it allows a business credits for the GST it pays for business-related expenses
D) there are no advantages to registering for GST - correct answer ✔✔C) it allows a business credits for
the GST it pays for business-related expenses
Items that are not taxable for GST -
, A) are mostly basic necessities
B) are consumed in Canada
C) are not used or needed by most Canadians
D) there are no items that do not have GST applied - correct answer ✔✔A) are mostly basic necessities
A business that is registered to collect PST from customers -
A) deducts the PST it pays on business-related expenses from the PST it remits to the provincial
government
B) does not pay PST on any business-related expenses
C) pays PST on most goods and services, just like GST
D) pays PST on taxable merchandise that it does not resell - correct answer ✔✔D) pays PST on taxable
merchandise that it does not resell
HST (Harmonized Sales Tax) differs from GST in that -
A) it has a different tax rate
B) it includes a portion for provincial sales tax
C) it applies to a different set of products and services
D) a and b above - correct answer ✔✔D) a and b above
Provincial sales taxes -
A) apply at the same rate in all provinces and territories in Canada
B) are always calculated on the sales amount before any other taxes are added
C) on purchases are treated as business expenses
D) increase revenue for a business by the amount of the tax collected from customers - correct answer
✔✔C) on purchases are treated as business expenses
