Answer:
a. As a result of this policy the Clinton corporation will loss the contribution margin
Contribution Margin = (Selling price – variable cost) * Number of units
= (95 – 88) * 10,000
= $77,000
b.The cost incurred by Clinton corporation by following this policy is Opportunity cost which is cost of forgone opportunity.
Opportunity cost = (Outside selling price – variable cost ) Number of units
=(133 – 88) * 10,000
= $450,000.
If a government is trying to encourage economic growth, they would do all of these things except raise taxes. Raising taxes has the opposite effect and will slow growth because it takes more money out of the economy that could be used for growth and expansion.
Answer:
The correct answer is a. In arriving at taxable income, a taxpayer must choose between the standard deduction and itemized deductions.
Explanation:
In tax law, the tax base is the magnitude that results from the measurement of the taxable event. It is defined as the dimension or magnitude of an element of the objective budget of the taxable event that is judged as determining the relative contributory capacity.
In tax legal relations, the taxable event shows the existence of an economic capacity in the subjects, but for the tax to be applied, this fact must be assessed in some way, usually in monetary units.
The tax base is ultimately the magnitude that is used in each tax to measure the economic capacity of the subject, such that it is reflected in ceilings.
