Jerry Foster Is a Sole Proprietorship Who Owns a Canoe

question 19

Multiple Choice

Jerry Foster is a sole proprietorship who owns a canoe renting business. Jerry’s
employee, Terry Gibbs, greets customers at the company’s office, loads the
customers and their rented canoes onto a van, provides them with safety
instructions and drives them upstream. Once unloaded the canoers are on their
own to float back to the company’s office to check in. Although there have been
minor accidents, no one has drowned in the nine years the business has been in
operation. Jerry plans to add kayaks and rubber rafts next year. The scenery is
beautiful and each day people see wild animals come down to the water.

-If someone does drown this year,who will be held liable?

• A)Terry Gibbs
• B)Jerry Foster
• C)Terry and Jerry
• D)the customer and/or his canoe partner

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Definitions:

Tax Schedules

Tables or formulas that determine the amount of tax due based on various factors, such as income level, filing status, and allowable deductions.

Economy

An area or system in which economic activities such as production, distribution, and consumption of goods and services occur.

Proportional Tax

A taxation system where the tax rate remains constant regardless of the amount subject to taxation.

Tax Schedules

Detailed tables or charts provided by tax authorities that dictate the tax rate applied to different levels of taxable income or expenditure.