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
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