Which of the Following Statements Is Correct

question 132

Multiple Choice

Which of the following statements is correct?

• A)A general sales tax on food is regressive when low-income taxpayers spend a larger proportion of their income on food than high-income taxpayers.
• B)A general sales tax on food is regressive when middle income taxpayers spend a smaller proportion of their income on food than high-income taxpayers.
• C)A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than middle income taxpayers.
• D)A general sales tax on food is regressive when high-income taxpayers spend a larger proportion of their income on food than low-income taxpayers.

---

Definitions:

Account

A record in financial accounting that tracks the financial transactions of a specific asset, liability, equity, revenue, or expense.

Aging

A method used in accounting to categorize the amounts owed by customers based on the length of time an invoice has been outstanding.

Allowance for Doubtful Accounts

A contra-asset account that reduces accounts receivable to reflect the estimated amounts that are expected to be uncollectible.

Uncollectible Percentage

An estimated fraction of accounts receivable that a company does not expect to collect.