Using the Following Choices, Show the Justification for Each Provision

question 154

Multiple Choice

Using the following choices, show the justification for each provision of the tax law listed.
a. Economic considerations
b. Social considerations
c. Equity considerations
d. Both a. and b.
-Wherewithal to pay concept

• A)Deferral of gains from involuntary conversions
• B)Carryforward of net operating losses
• C)"No change" is a possible result
• D)State income tax applied to a visiting nonresident
• E)IRS special agent
• F)Undoing the "piggyback" result
• G)Ideal budget goal as to new tax legislation
• H)Every state that has a general sales tax has one
• I)Imposed by all states and the Federal government
• J)Imposed by some states but not the Federal government
• K)Imposed only by the Federal government
• L)No correct match provided

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Definitions:

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer; it is not indicative of the security's market value.

Semiannually

Happening biannually or once every six months.

Market Interest Rate

The prevailing rate of interest available in the market on debt, which varies with market conditions and the term and risk of the investment.

Debt-To-Equity Ratio

An indicator of how a company's assets are financed, comparing the use of debt to shareholders' equity.