Question 1

Which of the following is/are not a primary source of authority for the tax law?

Accepted Answer

A)  A revenue ruling published by the Internal Revenue Service.
B)  Section 162 of the Internal Revenue Code.
C)  Treasury Reg.§1.351-2.
D)  All of the above are primary sources of authority.E) None of the above
F) B) and D) D

Question 2

A tax with a graduated rate structure must have at least two brackets of tax base.

Accepted Answer

A) True 
 B)False

Question 3

Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

Accepted Answer

A)  Acme Inc.
B)  Acme's customers.
C)  Acme's employees.
D)  Acme's shareholders.E) A) and D)
F) B) and C)

Question 4

How often does Congress amend the Internal Revenue Code?

Accepted Answer

A)  Rarely (the Internal Revenue Code has not been amended since 1986) 
B)  Occasionally (perhaps once every decade) 
C)  Regularly (at least once every five years) 
D)  Constantly (at least once a year) E) A) and B)
F) None of the above

Question 5

Richton Company operates its business solely in Jurisdiction H, which levies a 6% sales and use tax. This year, Richton paid $1,438,000 to purchase tangible property from a dealer located in Jurisdiction W. This purchase was subject to W's 3.5% sales tax. The property was shipped to Richton's office in Jurisdiction H for use in its business. Compute Richton's sales or use tax with respect to this transaction.

Accepted Answer

Richton must pay $50,330 sales...

Question 6

Which of the following statements concerning property taxes is false?

Accepted Answer

A)  Property taxes are ad valorem taxes.
B)  Property taxes are the primary source of revenue for local governments.
C)  Property taxes can be levied on realty or personalty.
D)  None of the above is false.E) A) and D)
F) A) and C)

Question 7

Payment of a tax entitles the payer to a specific good or service from the government.

Accepted Answer

A) True 
 B)False

Question 8

The person who pays a tax directly to the government always bears the economic incidence of the tax.

Accepted Answer

A) True 
 B)False

Question 9

A revenue ruling is an example of:

Accepted Answer

A)  Judicial authority
B)  Administrative authority
C)  Legislative authority
D)  Editorial authorityE) A) and D)
F) A) and B)

Question 10

Which of the following federal taxes is not earmarked for a specific purpose?

Accepted Answer

A)  Employment taxes
B)  Unemployment taxes
C)  Transfer taxes
D)  All of the above are earmarked taxes.E) None of the above
F) B) and C) C

Question 11

Which of the following statements concerning judicial authority is false?

Accepted Answer

A)  Appellate court decisions have more authority than trial court decisions.
B)  Supreme Court decisions have more authority than appellate court decisions.
C)  Supreme Court decisions are the equivalent of law.
D)  None of the above statements is false.E) B) and C)
F) A) and C)

Question 12

Ms. Penser resides in the city of Lanock, Tennessee. She owns 100% of the stock of PSW Inc., which is incorporated under Tennessee law and conducts business in six different local jurisdictions in Tennessee.
A. How many taxpayers are identified in the above statement of facts?
B. Identify the governments with jurisdiction to tax each of these taxpayers.

Accepted Answer

A. Ms. Penser is an individual taxpayer, and PSW Inc. is a corporate taxpayer. The city of Lanock, the state of Tennessee, and the United States have jurisdiction to tax Ms. Penser.
B. The six local jurisdictions, the state of Tennessee, and the United States have jurisdiction to tax PSW Inc.

Question 13

A tax is intended to deter or punish unacceptable behavior.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following does not contribute to the dynamic nature of the tax law?

Accepted Answer

A)  The political pressure from professional lobbyists.
B)  Changes in the economic and social climate.
C)  Changes in revenue needs of the government.
D)  All of the above contribute to the dynamic nature of the tax law.E) A) and D)
F) A) and C)

Question 15

The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Accepted Answer

A)  $10,230
B)  $11,230
C)  $11,730
D)  None of the aboveE) A) and C)
F) None of the above

Question 16

Which of the following taxes is a significant source of revenue for state governments?

Accepted Answer

A)  General sales tax
B)  Individual income tax
C)  Corporate income tax
D)  All of the aboveE) A) and B)
F) A) and C)

Question 17

Which of the following is an earmarked tax?

Accepted Answer

A)  A tax imposed on the purchase of specific items such as liquor or cigarettes.
B)  A tax that generates revenues that the government can spend only to build more National Parks.
C)  A tax imposed only on individuals who earn more than $1 million annually.
D)  A tax that generates revenues that the government can spend for any purpose.E) A) and C)
F) A) and D)

Question 18

Ad valorem property taxes are the major source of revenue for local governments.

Accepted Answer

A) True 
 B)False

Question 19

A tax is a payment to support the cost of government.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following sources of tax law carries the least authority?

Accepted Answer

A)  Revenue ruling.
B)  Treasury regulation.
C)  Section 736 of the Internal Revenue Code.
D)  The three sources of tax law have equal authority.E) B) and D)
F) B) and C)

Exam 1: Taxes and Taxing Jurisdictions

Which of the following is/are not a primary source of authority for the tax law?

Correct Answer
verified
D

A tax with a graduated rate structure must have at least two brackets of tax base.

Correct Answer
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Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

Correct Answer
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How often does Congress amend the Internal Revenue Code?

Correct Answer
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Correct Answer
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Richton must pay $50,330 sales...
View Answer

Which of the following statements concerning property taxes is false?

Correct Answer
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Payment of a tax entitles the payer to a specific good or service from the government.

Correct Answer
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The person who pays a tax directly to the government always bears the economic incidence of the tax.

Correct Answer
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A revenue ruling is an example of:

Correct Answer
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Which of the following federal taxes is not earmarked for a specific purpose?

Correct Answer
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C

Which of the following statements concerning judicial authority is false?

Correct Answer
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A tax is intended to deter or punish unacceptable behavior.

Correct Answer
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Which of the following does not contribute to the dynamic nature of the tax law?

Correct Answer
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The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Correct Answer
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Which of the following taxes is a significant source of revenue for state governments?

Correct Answer
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Which of the following is an earmarked tax?

Correct Answer
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Ad valorem property taxes are the major source of revenue for local governments.

Correct Answer
verified

A tax is a payment to support the cost of government.

Correct Answer
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Which of the following sources of tax law carries the least authority?

Correct Answer
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Exam 1: Taxes and Taxing Jurisdictions

Which of the following is/are not a primary source of authority for the tax law?

Correct AnswerverifiedD

A tax with a graduated rate structure must have at least two brackets of tax base.

Correct AnswerverifiedShow Answer

Acme Inc.'s property taxes increased by $19,000 this year. As a result, Acme eliminated $19,000 from its budget for the employee Christmas party. Who bears the incidence of the corporate tax increase?

Correct AnswerverifiedShow Answer

How often does Congress amend the Internal Revenue Code?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedRichton must pay $50,330 sales...View AnswerShow Answer

Which of the following statements concerning property taxes is false?

Correct AnswerverifiedShow Answer

Payment of a tax entitles the payer to a specific good or service from the government.

Correct AnswerverifiedShow Answer

The person who pays a tax directly to the government always bears the economic incidence of the tax.

Correct AnswerverifiedShow Answer

A revenue ruling is an example of:

Correct AnswerverifiedShow Answer

Which of the following federal taxes is not earmarked for a specific purpose?

Correct AnswerverifiedC

Which of the following statements concerning judicial authority is false?

Correct AnswerverifiedShow Answer

A tax is intended to deter or punish unacceptable behavior.

Correct AnswerverifiedShow Answer

Which of the following does not contribute to the dynamic nature of the tax law?

Correct AnswerverifiedShow Answer

The city of Springvale imposes a net income tax on businesses operating within its jurisdiction. The tax equals 1% of income up to $100,000 and 1.5% of income in excess of $100,000. The Springvale Bar and Grill generated $782,000 net income this year. Compute its city income tax.

Correct AnswerverifiedShow Answer

Which of the following taxes is a significant source of revenue for state governments?

Correct AnswerverifiedShow Answer

Which of the following is an earmarked tax?

Correct AnswerverifiedShow Answer

Ad valorem property taxes are the major source of revenue for local governments.

Correct AnswerverifiedShow Answer

A tax is a payment to support the cost of government.

Correct AnswerverifiedShow Answer

Which of the following sources of tax law carries the least authority?

Correct AnswerverifiedShow Answer

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D

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Richton must pay $50,330 sales...
View Answer

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C

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