TOPIC 2: BUSINESS TAXES (LAWS)

Question 1

The ____-____-____ act of 1999, allows business combinations between commercial banks, investments banks, and insurance companies.

Answer 1

Gramm-Leach-bliley act

Question 2

The ______ act of _____regulates the scale of Securities to the public via primary market.

Answer 2

Securities Acts of 1933

Question 3

The ______ _______ act of 1934 regulates the trading of securities such as stocks and bonds in the secondary market.

Answer 3

Securities exchange act of 1934

Question 4

Is the primary government agency responsible for enforcing federal securities laws.

Answer 4

Securities of Exchange Commission

Question 5

Both individual and businesses can earn two types of income.

Answer 5

Ordinary Income and Capital Gains Income

Question 6

Is earned through sale of a firm’s goods or services.

Answer 6

Ordinary Income

Question 7

A firm’s ______ represents the rate at which additional income is a taxed.

Answer 7

Marginal tax rate

Question 8

Is the firm’s taxes divided by taxable income

Answer 8

Average tax rate

Question 9

This exclusion moderates the effect of _______, which occurs when after-tax corporate earnings are distributed as ______ dividends to stock holders.

Answer 9

double taxation
Cash

Question 10

Unlike dividend income, all interest income received is _____ _____.

Answer 10

Fully taxed

Question 11

In calculating taxes, corporations may deduct operating expense and Interest expense but not ______ paids.

Answer 11

Tax—deductible expenses.

Question 12

Is the amount by which the sale price of an asset exceeds the asset’s purchase price.

Answer 12

Capital gain