Double-Taxation in the U.S.tax System Generally Refers To

question 55

Multiple Choice

Double-taxation in the U.S.tax system generally refers to:

• A)the fact that both employers and employees pay a payroll tax.
• B)the taxation as regular income of dividends paid to stockholders out of profits upon which taxes have already been paid.
• C)the occasional imposition of a tax surcharge on the personal income tax paid by Americans to their federal government.
• D)the doubling of the corporate profits tax rate as corporations' incomes climb above $100,000.
• E)none of the above.

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Definitions:

Year 1

Refers to the first year of operation for a business or the first year of a specific reporting period.

Contra-asset

A contra-asset account is a type of asset account where its balance is a negative figure that offsets the balance of its corresponding asset account.

Liability

A financial obligation or debt owed by a company to another entity, which is expected to be settled through the transfer of assets or services.

Inventory

Consists of all the goods a company has in stock that are ready to be sold, including raw materials, work-in-progress, and finished goods.