some exclusions exist for taxable income, such as using the money for provident funds, insurance policies, charity, etc. Individuals can deduct those transactions from their income and then calculate their taxes.
The government has a number of tools at its disposal to intervene when problems arise. They may use regulations, funding, the creation of new government programs, and taxes or tax breaks. They can also intervene when there are natural disasters too big for local governments to handle. These ...
What are the effects of contractionary fiscal policy? Contractionary fiscal policy will slow down the economy. If the government decides to cut taxes and decrease government spending, then the effect would be that the aggregate demand would decrease because less money will be spent.Fiscal...
Groups that focus on tax fairness generally choose one of three possible tax systems. These systems are regressive taxation, proportional taxation, and progressive taxation. Regressive Taxation Regressive taxationtaxes everyone the same amount, regardless of their ability to pay. As a result, the poor...
Excise taxes are either fixed or proportional: specific or ad valorem taxes, respectively: Specific taxes. A specific tax is a fixed dollar amount. It’s the same for every purchase of a particular taxable item. Think of fixed fees added to a gallon of car gas, an airline ticket, or a...
Costs (both direct and indirect) can also be classified into the following groups based on their behavior relative to changes in the volume of activity: Variable costs Fixed costs Semi-variable or semi-fixed costs Variable costs are costs that vary in a directly proportional way to changes in ...
6. Introduction to Taxes and Subsidies Topic summary 1 concept Tax Equity Video duration: 6m Take your learning anywhere! Prep for your exams on the go with video lessons and practice problems in our mobile app. Continue in the app
Also known as salvage value, it is calculated for the firms to be aware of the existing value of the asset when it is of no use anymore. This value is inversely proportional to the length of the useful life of the asset and helps businesses know how much they will receive if they sell...
Companies may engage in earnings management to meet analyst expectations, boost stock prices, or minimize taxes. The Definition of Earnings Management Earnings management refers to the practice of manipulating a company’s financial statements to influence its reported earnings. While some forms of earni...