The State of Georgia Recently Increased Its Tax on a Carton

question 98

Multiple Choice

The state of Georgia recently increased its tax on a carton of cigarettes by $2.00. What type of tax is this?

• A) A sin tax
• B) An excise tax
• C) It is not a tax; it is a fine
• D) Both a sin tax and an excise tax are correct
• E) None of these is correct

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Definitions:

Stockholders' Equity

Represents the owners' interest in a company, calculated as the difference between total assets and total liabilities.

Paid-In Capital

Paid-in capital is the amount of money investors have contributed to a company in exchange for equity.

Retained Earnings

The portion of net income not distributed to shareholders and instead reinvested in the company or used to pay off debt.

Common Stock

A type of security that represents ownership in a corporation, with voting rights and potential for dividends.