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. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
2. The federal personal income tax is a flat tax.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
3. Tax avoidance is legal, tax evasion is illegal.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-5 – LO: 3-5
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
4. One’s marginal tax rate is typically lower than one’s average tax rate.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Analyzing
5. One’s average tax rate is typically lower than one’s marginal tax rate.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Analyzing
6. If you have any earned income, you are required to file a tax return.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Moderate
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: 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. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-6 – LO: 3-6
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: 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. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
9. Income tax refunds are automatically sent to those who qualify for refunds no later than April 15.
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
10. As a single taxpayer with no dependents, one is generally eligible to file as “head of household.”
a. True
b. False
ANSWER: False
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
11. Russ and Lois got married December 30. Although they were single for most of the year, they can legally file as married taxpayers in the year of the wedding.
a. True
b. False
ANSWER: True
POINTS: 1
DIFFICULTY: Easy
LEARNING OBJECTIVES: PFIN.BILL.17.3-1 – LO: 3-1
NATIONAL STANDARDS: United States – BUSPROG: Analytic skills – BUSPROG: Analytical skills
STATE STANDARDS: United States – KS – DISC: Financial Analysis and Cas – DISC: Financial Analysis and Cash Flows
United States – AK – DISC: Taxes
KEYWORDS: Bloom’s: Remembering
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