Every Year,the IRS Selects a Certain Number of Form 1040s

question 47

Multiple Choice

Every year,the IRS selects a certain number of Form 1040s for audit.What is the approximate average audit coverage rate (percentage of individual returns filed selected for audit) ?

• A)About 1%
• B)About 5%
• C)Between 10% and 12%
• D)None of the above

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Definitions:

Primary Market

The market where new securities are issued and sold for the first time, directly from the issuer to investors.

First-Time Issues

Refers to the initial offering of securities or stocks to the public by a company.

Securities

Financial instruments representing ownership (stocks), creditor relationships (bonds), or rights to ownership (options).

Primary Market Transaction

Occurs when new securities are sold for the first time to investors, directly impacting the issuing company's capital.