Test Bank For Personal Financial Planning 14th Edition by Billingsley
Chapter 3—Preparing Your Taxes
1. The federal personal income tax is a progressive tax.a. Trueb. FalseANSWER:  TruePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  2. The federal personal income tax is a flat tax.a. Trueb. FalseANSWER:  FalsePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  3. Tax avoidance is legal, tax evasion is illegal.a. Trueb. FalseANSWER:  TruePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-5 – LO: 3-5NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  4. One’s marginal tax rate is typically lower than one’s average tax rate.a. Trueb. FalseANSWER:  FalsePOINTS:  1DIFFICULTY:  ModerateLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Analyzing  5. One’s average tax rate is typically lower than one’s marginal tax rate.a. Trueb. FalseANSWER:  TruePOINTS:  1DIFFICULTY:  ModerateLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Analyzing  6. If you have any earned income, you are required to file a tax return.a. Trueb. FalseANSWER:  FalsePOINTS:  1DIFFICULTY:  ModerateLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  7. The main objective of tax planning is to maximize the amount of money you keep by minimizing the amount of taxes you pay.a. Trueb. FalseANSWER:  TruePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-6 – LO: 3-6NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Understanding  8. If you are eligible to receive a tax refund, you will have to file a tax return to get the refund.a. Trueb. FalseANSWER:  TruePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  9. Income tax refunds are automatically sent to those who qualify for refunds no later than April 15.a. Trueb. FalseANSWER:  FalsePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering  10. As a single taxpayer with no dependents, one is generally eligible to file as “head of household.”a. Trueb. FalseANSWER:  FalsePOINTS:  1DIFFICULTY:  EasyLEARNING OBJECTIVES:  PFIN.BILL.17.3-1 – LO: 3-1NATIONAL STANDARDS:  United States – BUSPROG: Analytic skills – BUSPROG: Analytical skillsSTATE STANDARDS:  United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash FlowsUnited States – AK – DISC: TaxesKEYWORDS:  Bloom’s: Remembering
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