Practice_Midterm_1

Practice_Midterm_1 - ACC 330 Practice Midterm Exam 1...

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ACC 330 – Practice Midterm Exam 1 Professor Lindsey Part Total Points Your Score 1 5 2 15 3 10 4 25 5 20 6 25 Total 100 I cannot award partial credit for work I cannot see. Stay confident and be positive!! Please round dollar amounts to whole dollars.
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Part 1 (5 Points) Your overpriced textbook states the following in Chapter 11: “Corporations do not pay taxes – people do.” Given that is true, many academics and government employees have researched who bears the economic incidence of the corporate income tax. 1. What is “incidence”? 2. Briefly explain how customers, employees, and shareholders may bear the incidence of the corporate income tax. Please only write one short sentence. Customers: Employees: Shareholders:
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Part 2 (15 Points) 1. What is vertical equity? 2. Note the three taxes below: Social Security Payroll Tax In 2011, the employee portion of the social security tax is 4.2 percent of an employee’s wages capped at the 2011 social security tax wage base of $106,800. Wages above this amount are not taxed. Medicare Payroll Tax In 2011, the employee portion of the medicare tax is 1.45 percent of an employee’s wages with no cap on the wages subject to the tax. Individual Income Tax In 2011, single and married individual taxpayers use the following tax rate schedule to compute their income taxes: Tax Bracket Married Filing Jointly Single 10% Bracket $0 – $17,000 $0 – $8,500 15% Bracket $17,001 – $69,000 $8,501 – $34,500 25% Bracket $69,001 – $139,350 $34,501 – $83,600 28% Bracket $139,351 – $212,300 $83,601 – $174,400 33% Bracket $212,301 – $379,150 $174,401 – $379,150 35% Bracket Over $379,150 Over $379,150 A. Which of the three taxes, if any, meet the definition of vertical equity?
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Does each of the taxes have a regressive, proportional, or progressive tax rate structure? Social Security Tax:
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Practice_Midterm_1 - ACC 330 Practice Midterm Exam 1...

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