In 2016, Mike Elfred Received a $165,000 Salary from His

question 97

Multiple Choice

In 2016, Mike Elfred received a $165,000 salary from his employer and generated $39,000 net earnings from self-employment from his small business. Which of the following statements is true?

• A) Mike does not owe any self-employment tax because his salary exceeded the 2016 base amount ($118,500) for federal employment tax.
• B) Mike owes both the Medicare and Social Security tax portions of self-employment tax on his $39,000 earnings from his small business.
• C) Mike owes Medicare tax but not Social Security tax on his $39,000 earnings from his small business.
• D) Mike owes Social Security tax but not Medicare tax on his $39,000 earnings from his small business.

Identify and classify sequences as arithmetic or geometric.

Calculate the common difference of arithmetic sequences.

Calculate the common ratio of geometric sequences.

Use arithmetic sequence formulas to find specific terms and sums.

---

Definitions:

Direct Method

An approach in cost accounting that traces costs directly to cost objects without distributing indirect costs.

Inventories

The raw materials, work-in-progress products, and finished goods that a company holds for the purpose of sale in the future.

Accounts Payable

Liabilities to creditors that must be paid within a short period, usually less than a year.

Operating Activities

Activities that constitute the primary or main activities of an organization, including production, sales, and delivery of services.