Which of the Following Is Most Effective in Mitigating the Double

question 65

Multiple Choice

Which of the following is most effective in mitigating the double tax?

• A) Shift income from high tax rate shareholders to low tax rate corporations.
• B) Shift income from low tax rate shareholders to high tax rate corporations.
• C) Shift income from high tax rate corporations to low tax rate shareholders.
• D) Shift income from low tax rate corporations to high tax rate shareholders.

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Definitions:

Enterprise Fund

A fund established by a government to account for operations financed by user charges, often used for utilities and public services.

Journal Entry

A recording of a transaction in an accounting journal that notes the debits and credits affecting the accounts involved.

GASB Statement No. 87

A statement issued by the Governmental Accounting Standards Board establishing guidelines for reporting lease transactions in governmental financial statements.

Financing Leases

Long-term lease agreements where the lessee assumes many of the economic risks and rewards of ownership.