Identify Which of the Following Statements Is True

question 9

Multiple Choice

Identify which of the following statements is true.

• A) If both the failure- to- file and the failure- to- pay penalties are owed, the taxpayer will incur a maximum addition to tax of 5.5% per month.
• B) The failure- to- pay penalty is waived if the additional tax due with the filing of the extended return does not exceed 15% of the tax owed for the year.
• C) Individuals having substantial income from sources not subject to regular withholding generally should make quarterly estimated tax payments to the IRS.
• D) All of the above are false.

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Definitions:

Depreciation Expense

The allocated portion of the cost of a tangible fixed asset that is charged as an expense in a reporting period, reflecting the usage and wear and tear of the asset.

Accumulated Depreciation

The total amount of a tangible asset's cost that has been expensed to depreciation over the asset's useful life, reflecting how much of the asset's value has been used up.

Consolidation Worksheet

A tool used in preparing consolidated financial statements, allowing a company to adjust and eliminate the transactions among its controlled entities.

Plant

In terms of fixed assets, it refers to the buildings, machinery, equipment, and property used in the operations of a business.