During the 1990's, a Major Problem in Evaluating the Financial

question 43

Multiple Choice

During the 1990's, a major problem in evaluating the financial statements of Eastern European companies that had been under the control of the Soviet Union was:

• A)that the statements had been used for government planning rather than for private investors.
• B)that few people spoke the languages in which the financial statements were written.
• C)that East European currencies had been greatly devalued relative to the U.S.dollar.
• D)that financial reporting had not been done since the Bolshevik Revolution.

---

Definitions:

Taxable Income

The amount of income used to calculate how much tax an individual or a company owes to the government, after deductions and exemptions.

Marginal Tax Rate

It is the rate at which the last dollar of income is taxed, reflecting the percentage of tax applied to your income for each tax bracket in which you qualify.

Taxable Income

The amount of income subject to taxes, after all deductions and exemptions are taken into account.

Nominally Progressive

Pertaining to tax structures where the nominal rates increase as the taxable base increases, without necessarily resulting in a higher effective tax rate on higher incomes due to possible deductions and exemptions.