Nine States Have a Community Property System of Marital Law

question 12

Multiple Choice

Nine states have a community property system of marital law.Which of the following statements is correct?

• A)Federal law determines how income will be allocated to husband and wife in community property states.
• B)Separate property acquired before marriage becomes community property after marriage in community property states.
• C)In some states,separate property can give rise to community income.
• D)Married couples in community property states filing joint tax returns allocate their income according to state community property laws.
• E)Even though the spouses have been living apart for an entire year,personal earnings will generally be treated as having been earned one-half by each spouse.

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Definitions:

Implicit Costs

The opportunity costs of using resources owned by the company for its own operations, rather than earning income elsewhere.

Explicit Costs

Direct payments made to others in the course of running a business, such as wages, rent, and materials.

Implicit Costs

Costs that represent foregone opportunities, such as the income a business owner forgoes by investing in their own company instead of elsewhere.

Explicit Costs

Directly incurred expenses in the operation of a business, such as wages, rent, and material costs, which are clearly accounted for and easy to identify.