Match Each Statement with the Correct Term Below

question 62

Multiple Choice

Match each statement with the correct term below.
-Points

• A)Prepaid interest.
• B)Either a qualifying child or a qualifying relative
• C)One test for a qualifying relative.
• D)The minimum amount a taxpayer can deduct for personal expenditures.
• E)A deduction in this category is always allowed. That is, there is no minimum allowable amount and generally no income limitation placed on these deductions.
• F)Generally, these deductions are for specifically allowed personal expenditures.
• G)An exception to this test is a custodial parent.
• H)Interest paid on debt used to buy securities.
• I)Interest paid on credit cards, personal loans, car loans, etc.
• J)Interest paid on a mortgage secured by the taxpayer's residence. The proceeds of the loan are used to pay off a credit card, the interest is not deductible.
• k.A tax designed to prevent the shifting of unearned income to children of the taxpayer.

---

Definitions:

Direct Materials

Direct materials are raw materials that are directly traceable to the manufacturing of a product and are a significant component of the total manufacturing cost.

Variable Manufacturing Overhead

Costs involved in the manufacturing process that fluctuate with the level of production, such as utility expenses or materials costs.

Absorption Costing

An accounting method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed manufacturing overhead—in the cost of a product.

Absorption Costing

This method includes all manufacturing costs (direct materials, direct labor, and both variable and fixed manufacturing overhead) in the cost of a product.