ACC330_Exam1_Part1

ACC330_Exam1_Part1 - ACCOUNTING 330 - EXAM I - PART I -...

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ACCOUNTING 330 - EXAM I - PART I - SPRING 2011 Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Which, if any, of the following taxes are proportional (rather than progressive )? a. Federal corporate income tax. b. Federal gift tax. c. Federal estate tax. d. Federal employment taxes (i.e., FICA, FUTA). e. All of the above. ____ 2. A characteristic of FICA is that: a. It is imposed only on the employer. b. It applies when one spouse works for the other spouse. c. It provides a modest source of income in the event of loss of employment. d. It is administered by both state and Federal governments. e. None of the above. ____ 3. A characteristic of FUTA is that: a. It is imposed on both employer and employee. b. It is imposed solely on the employee. c. Compliance requires following guidelines issued by both state and Federal regulatory authorities. d. It is applicable to spouses of employees but not to any children under age 18. e. None of the above. ____ 4. The proposed flat tax : a. Would simplify the income tax. b. Would eliminate the income tax. c. Would tax the increment in value as goods move through the production and manufacturing stages to the marketplace. d. Is a tax on consumption. e. None of the above. ____ 5. A VAT (value added tax): a. Is not regressive in its effect. b. Has proved quite popular outside of the U.S. c. Is not a tax on consumption. d. Is used exclusively by third world (less developed) countries. e. None of the above. ____ 6. Characteristics of the “Fair Tax” (i.e., national sales tax) include which, if any, of the following: a. Abolition of the Federal individual (but not the corporate) income tax. b. Abolition of all Federal income taxes but retention of payroll taxes (including the self- employment tax). c. Abolition of all Federal income taxes and payroll taxes but retention of the Federal estate and gift taxes. d. Abolition of all Federal income and payroll taxes as well as the Federal estate and gift taxes. e. None of the above.
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____ 7. In terms of probability, which of the following taxpayers would be least likely to be audited by the IRS? a. Taxpayer owns and operates a check-cashing service. b. Taxpayer is an employed electrician. c. Taxpayer just received a $3 million personal injury award as a result of a lawsuit. d. Taxpayer just won a $1 million slot machine jackpot at a Las Vegas casino. e. Taxpayer has been audited several times before. ____ 8. Which of the following is a characteristic of the audit process? a. The IRS does not reward informants even when the information provided leads to the collection of additional taxes. b. Most taxpayer audits involve “special” agents. c.
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This note was uploaded on 04/10/2011 for the course ACC 330 taught by Professor Sign during the Spring '11 term at S. Alabama.

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ACC330_Exam1_Part1 - ACCOUNTING 330 - EXAM I - PART I -...

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