Craig Commits Fraud on His Tax Return

question 3

Multiple Choice

Craig commits fraud on his tax return. It is found that he was $40,000 deficient in his tax because of the fraud. What would his penalty be?

• A)$500
• B)$30,000
• C)$40,000
• D)$0

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Definitions:

Existing Asset

Assets that are currently in possession or use by a company, as opposed to newly acquired or disposed assets.

Firm Commitment

An agreement between a buyer and a seller wherein the seller is obligated to supply an agreed-upon amount of goods or services at a specified price.

Derivative Instrument

A financial security whose value is dependent upon or derived from an underlying asset or group of assets.

Options Contract

A financial derivative that gives the buyer the right, but not the obligation, to buy or sell an asset at a set price on or before a given date.