CGA Taxation & Compliance

Question 1

Which tax form is typically used by individuals to file their annual income tax return?

Accepted Answer

Form 1040

Answer

W-2

Answer

1099

Answer

Form 941

Question 2

What is the main purpose of a value-added tax (VAT)?

Accepted Answer

Tax on added value in goods/services

Answer

Tax on net profit

Answer

Tax on dividends

Answer

Tax on business assets

Question 3

Which concept ensures companies report income and expenses in the appropriate period?

Accepted Answer

Accrual principle

Answer

Going concern principle

Answer

Cash basis accounting

Answer

Materiality principle

Question 4

What is the term for the deliberate failure to pay taxes owed?

Accepted Answer

Tax evasion

Answer

Tax planning

Answer

Tax avoidance

Answer

Tax optimization

Question 5

Which agency is responsible for enforcing federal tax laws in the United States?

Accepted Answer

IRS

Answer

SEC

Answer

FASB

Answer

GAO

Question 6

What is the purpose of withholding tax from an employee's paycheck?

Accepted Answer

To prepay income tax

Answer

To pay retirement benefits

Answer

To increase employee savings

Answer

To avoid Social Security tax

Question 7

Which tax allows businesses to reduce taxable income based on capital purchases?

Accepted Answer

Depreciation

Answer

Amortization

Answer

Accruals

Answer

Revenue recognition

Question 8

What is the primary purpose of tax compliance?

Accepted Answer

To comply with legal obligations

Answer

To maximize tax refunds

Answer

To estimate earnings

Answer

To defer audits

Question 9

Which concept allows businesses to legally reduce tax liabilities?

Accepted Answer

Tax avoidance

Answer

Tax fraud

Answer

Tax evasion

Answer

Double taxation