An Average Tax Rate Is Calculated as

question 255

Multiple Choice

An average tax rate is calculated as

• A)total taxable income × taxes paid.
• B)total taxable income ÷ taxes paid.
• C)taxes paid ÷ total taxable income.
• D)(total taxable income - taxes paid)÷ taxable income.

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Definitions:

Financing Activities

Transactions and events that affect the long-term liabilities and equity of an entity, typically involving the inflow of cash from investors or banks.

Indirect Method

A technique used in the statement of cash flows to adjust net income for the effects of non-cash transactions and changes in working capital to determine cash flow from operating activities.

Operating Activities

Activities directly related to the day-to-day operations of a business, such as sales, purchasing, payroll, and other routine business transactions.

Indirect Method

A way of reporting cash flows from operating activities on the statement of cash flows, adjusting net income for changes in non-cash accounts.