Question 1

The effective tax rate expresses the taxpayer's total tax as a percentage of the taxpayer's taxable and nontaxable income.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is considered a tax?

Accepted Answer

A) Tolls 
B) Parking meter fees 
C) Annual licensing fees 
D) A local surcharge paid on retail sales to fund public schools 
E) Entrance fees paid at national parks 
A) Tolls 
B) Parking meter fees 
C) Annual licensing fees 
D) A local surcharge paid on retail sales to fund public schools 
E) Entrance fees paid at national parks

Question 3

Relative to explicit taxes, implicit taxes are much easier to estimate.

Accepted Answer

A) True 
 B)False

Question 4

Consider the following tax rate structures. Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Accepted Answer

The tax rate schedule is horizontally eq

Question 5

Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham Bonds. Using the U.S. tax rate schedule for year 2016, what is his average tax rate (rounded)?

Accepted Answer

A) 17.95% 
B) 15.00% 
C) 18.49% 
D) 25.00% 
E) None of these 
A) 17.95% 
B) 15.00% 
C) 18.49% 
D) 25.00% 
E) None of these

Question 6

Which of the following would not be a failure of the horizontal equity concept?

Accepted Answer

A) Two taxpayers with identical income pay different amounts of tax because one taxpayer's income includes tax exempt interest. 
B) Two taxpayers pay different amounts of property tax amounts on similar plots of land (i.e., same value) because one plot of land is used to raise crops. 
C) Two taxpayers pay different amounts of estate tax because one taxpayer's estate is worth significantly more. 
D) All of these. 
E) None of these. 
A) Two taxpayers with identical income pay different amounts of tax because one taxpayer's income includes tax exempt interest. 
B) Two taxpayers pay different amounts of property tax amounts on similar plots of land (i.e., same value) because one plot of land is used to raise crops. 
C) Two taxpayers pay different amounts of estate tax because one taxpayer's estate is worth significantly more. 
D) All of these. 
E) None of these.

Question 7

Jackson has the choice to invest in city of Mitchell bonds or Sundial, Inc. corporate bonds that pay 10% interest. Jackson is a single taxpayer who earns $55,000 annually. Assume that the city of Mitchell bonds and the Sundial, Inc. bonds have similar risk.
What interest rate would the city of Mitchell have to pay in order to make Jackson indifferent between investing in the city of Mitchell and the Sundial, Inc. bonds for year 2016?

Accepted Answer

A) 7.50% 
B) 10.00% 
C) 8.00% 
D) 7.20% 
E) None of these 
A) 7.50% 
B) 10.00% 
C) 8.00% 
D) 7.20% 
E) None of these

Question 8

Congress recently approved a new, bigger budget for the IRS. What taxation concept evaluates the cost of administering our tax law?

Accepted Answer

A) Convenience 
B) Economy 
C) Certainty 
D) Equity 
E) None of these 
A) Convenience 
B) Economy 
C) Certainty 
D) Equity 
E) None of these

Question 9

The main difficulty in calculating an income tax is determining the correct amount of the tax base.

Accepted Answer

A) True 
 B)False

Question 10

A common example of an employment related tax is the Medicare tax.

Accepted Answer

A) True 
 B)False

The effective tax rate expresses the taxpayer's total tax as a percentage of the taxpayer's taxable and nontaxable income.

Which of the following is considered a tax?

Relative to explicit taxes, implicit taxes are much easier to estimate.

Consider the following tax rate structures. Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham Bonds. Using the U.S. tax rate schedule for year 2016, what is his average tax rate (rounded)?

Which of the following would not be a failure of the horizontal equity concept?

Congress recently approved a new, bigger budget for the IRS. What taxation concept evaluates the cost of administering our tax law?

The main difficulty in calculating an income tax is determining the correct amount of the tax base.

A common example of an employment related tax is the Medicare tax.

Tax Compliance, the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview, Exemptions, and Filing Status

Gross Income and Exclusions

Individual Deductions

Investments

Individual Income Tax Computation and Tax Credits

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Us Taxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters

Exam 1: An Introduction to Tax

The effective tax rate expresses the taxpayer's total tax as a percentage of the taxpayer's taxable and nontaxable income.

Which of the following is considered a tax?

Relative to explicit taxes, implicit taxes are much easier to estimate.

Consider the following tax rate structures. Is it horizontally equitable? Why or why not? Is it vertically equitable? Why or why not?

Marc, a single taxpayer, earns $60,000 in taxable income and $5,000 in interest from an investment in city of Birmingham Bonds. Using the U.S. tax rate schedule for year 2016, what is his average tax rate (rounded)?

Which of the following would not be a failure of the horizontal equity concept?

Congress recently approved a new, bigger budget for the IRS. What taxation concept evaluates the cost of administering our tax law?

The main difficulty in calculating an income tax is determining the correct amount of the tax base.

A common example of an employment related tax is the Medicare tax.

Tax Compliance, the Irs, and Tax Authorities

Tax Planning Strategies and Related Limitations

Individual Income Tax Overview, Exemptions, and Filing Status

Gross Income and Exclusions

Individual Deductions

Investments

Individual Income Tax Computation and Tax Credits

Business Income, Deductions, and Accounting Methods

Property Acquisition and Cost Recovery

Property Dispositions

Compensation

Retirement Savings and Deferred Compensation

Tax Consequences of Home Ownership

Entities Overview

Corporate Operations

Accounting for Income Taxes

Corporate Taxation: Nonliquidating Distributions

Corporate Formation, Reorganization, and Liquidation

Forming and Operating Partnerships

Dispositions of Partnership Interests and Partnership Distributions

S Corporations

State and Local Taxes

The Us Taxation of Multinational Transactions

Transfer Taxes and Wealth Planning

Filters