The Going Concern Assumption Is Not Applied to

question 95

Multiple Choice

The going concern assumption is not applied to

• A) companies that have sustained losses for the previous two years.
• B) companies about to file for bankruptcy.
• C) the partnership form of business.
• D) companies that have been in existence for less than a year.

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Definitions:

Medicare Tax Rate

The percentage of an individual's or employee's earnings that is collected by the government to fund Medicare, a federal health insurance program.

State Unemployment Tax

A tax imposed on employers by the state government to fund unemployment benefits for workers who have lost their jobs.

FICA Taxes Payable

Amounts due for Social Security and Medicare taxes, required to be withheld from employees' paychecks and matched by employers.

Payroll Tax Expense

Taxes that employers are required to pay based on the salary and wages paid to employees, including social security and Medicare taxes in the United States.