The Idea That Individuals Should Be Taxed in Proportion to the Marginal

question 110

Multiple Choice

The idea that individuals should be taxed in proportion to the marginal benefits that they receive from public goods is called

• A)the ability-to-pay principle.
• B)the horizontal-equity principle.
• C)the vertical-equity principle.
• D)the benefits-received principle.

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Definitions:

Income Summary

An account used in closing entries to collect the revenue and expenses for a specific accounting period before transferring the net result to capital.

Expenses

Costs incurred in the process of earning revenues, typically categorized as operating or non-operating.

Owner's Drawings

Withdrawals made by the owner of a sole proprietorship or partnership from the business for personal use.

Revenues

The total income generated from the sale of goods or services related to a company's primary operations.