Management Sciences MCQs

What is the primary purpose of payroll taxes? A) To fund social security and Medicare B) To pay for state education programs C) To support local government projects D) To finance corporate tax credits Answer: A Which of the following taxes is typically withheld from an employee’s paycheck? A) Federal income tax B) Sales tax … Read more

What is estate tax? A) A tax on the transfer of property at death B) A tax on income earned by individuals C) A tax on the purchase of real estate D) A tax on corporate profits Answer: A What is gift tax? A) A tax on transfers of property during a person’s lifetime B) … Read more

What is transfer pricing? A) Pricing of goods and services between related entities within a multinational enterprise B) Pricing of goods and services between unrelated entities C) Pricing of goods sold domestically D) Pricing of financial securities Answer: A Which principle requires that transactions between related entities be priced as if they were between unrelated … Read more

What is international taxation? A) Taxation of income earned within a country B) Taxation of cross-border income and transactions C) Taxation of goods and services only D) Taxation imposed only on foreign entities Answer: B Which document often serves as the basis for double tax treaties? A) OECD Model Tax Convention B) UN Model Tax … Read more

What is tax compliance? A) Avoiding paying taxes B) Meeting legal requirements and regulations for reporting and paying taxes C) Manipulating financial statements D) Concealing income Answer: B Which document is commonly used to report annual income to tax authorities? A) W-2 Form B) 1099 Form C) 1040 Form D) All of the above Answer: … Read more

What is the primary difference between tax evasion and tax avoidance? A) Tax evasion is legal, while tax avoidance is illegal. B) Tax evasion involves illegal activities to avoid paying taxes, while tax avoidance involves legal methods to minimize tax liability. C) Tax evasion is a form of tax avoidance. D) Tax avoidance is a … Read more

What is the primary tax characteristic of a partnership? A) Partnerships are taxed as separate entities. B) Partnerships do not pay taxes; income is passed through to partners. C) Partnerships pay corporate income tax. D) Partnerships are subject to VAT. Answer: B How is income from a partnership typically taxed? A) At the partnership level … Read more

What is Wealth Tax? A) A tax on income earned B) A tax on the value of assets owned by an individual or entity C) A tax on sales transactions D) A tax on corporate profits Answer: B Which of the following is typically subject to Wealth Tax? A) Salary B) Capital gains C) Real … Read more

What is the primary purpose of a Double Taxation Avoidance Agreement (DTAA)? A) To increase tax rates B) To eliminate double taxation on income earned in multiple countries C) To avoid tax filing requirements D) To increase tax liabilities Answer: B Which of the following is a typical provision in a DTAA? A) Tax exemption … Read more

What is the primary goal of tax planning? A) To minimize taxes paid B) To maximize taxable income C) To avoid tax filing D) To increase tax rates Answer: A Which of the following is a common tax planning strategy for individuals? A) Investing in high-risk stocks B) Contributing to a tax-deferred retirement account C) … Read more