Which of the Following Statements Concerning the Federal Social Security

question 26

Multiple Choice

Which of the following statements concerning the federal Social Security tax is true?

• A) The tax burden increases annually because the rate generally increases annually.
• B) The tax burden increases annually because the base generally increases annually.
• C) Both the rate and the base generally increase annually.
• D) The Social Security tax burden has not increased since 1990.

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Definitions:

Equity

The value of an ownership interest in property, including shareholders' equity in a business.

Liabilities

Financial obligations or debts that a company owes to others, which must be settled over time through the transfer of economic benefits including money, goods, or services.

Inventory Turnover

An activity ratio that measures the liquidity of the firm’s inventory—how quickly goods are sold and replenished.

Average Collection Period

A measure of how long it takes a firm to convert a credit sale (internal store credit, not credit card sales) into a usable form (cash).