Wen Hung Is Buying a Building to Open an Alterations

question 35

Multiple Choice

Wen Hung is buying a building to open an alterations business. One building costs $205,000 with a property tax rate of $4.45 per $100 on 60% assessed value. A second building costs $195,000 with a property tax rate of 42 mills per dollar on 75% assessed value. What is the difference in the property tax amounts?

• A) $669
• B) $875
• C) $932
• D) $1,125

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Definitions:

Industry Segments

Specific categories within an industry that companies can be classified under based on their main business activities.

Revenue Test

A criterion used to determine whether a business segment's revenue is sufficient for it to be considered a reportable segment under financial reporting standards.

Separately Reportable

Items or activities that must be individually disclosed in financial statements due to their significance or regulatory requirements.

Operating Profit Or Loss Test

A financial measure used to determine a company's profitability from its core business operations, excluding non-operational factors.