FREE Accounting Technician Taxation & Regulatory Compliance Questions and Answers
Which tax is commonly deducted from an employee’s paycheck?
Payroll taxes, such as Social Security and Medicare, are deducted from employee wages to fund government programs.
What is the primary purpose of taxation?
Taxation is used by governments to generate revenue for public services such as infrastructure, education, and healthcare.
What is the main goal of financial audits?
Financial audits provide independent verification of a company’s financial statements, ensuring accuracy and compliance with regulations.
Which entity enforces tax regulations in the United States?
The Internal Revenue Service (IRS) is responsible for enforcing tax laws, collecting taxes, and overseeing tax compliance.
What is the purpose of regulatory compliance in accounting?
Regulatory compliance ensures businesses adhere to laws and financial reporting standards, promoting transparency and accountability.
Why must businesses maintain proper tax records?
Maintaining accurate tax records ensures businesses comply with tax regulations, avoid penalties, and facilitate audits if needed.