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PF&T model questions

The document contains a series of multiple-choice questions related to taxation concepts and calculations, including types of taxes, tax implications for individuals and businesses, and specific tax amounts based on given income scenarios. Each question provides four answer options, requiring knowledge of tax principles and regulations. The content is focused on understanding different tax classifications and their applications in various financial situations.

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amogne
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21 views

PF&T model questions

The document contains a series of multiple-choice questions related to taxation concepts and calculations, including types of taxes, tax implications for individuals and businesses, and specific tax amounts based on given income scenarios. Each question provides four answer options, requiring knowledge of tax principles and regulations. The content is focused on understanding different tax classifications and their applications in various financial situations.

Uploaded by

amogne
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Part Two: Multiple Choices

1. Richer people save a larger fraction of their income than do poorer people. (That is,
poorer people generally spend a larger fraction of their income than do richer people.) So
a general sales tax imposed on all purchases is a:
A. Digressive tax C. Proportional tax
B. Progressive tax D. Regressive tax
2. The nature of indirect tax is ……………
A. Progressive C. Proportional
B. Regressive D. None of the above
3. Assume that ABC PLC has earned an annual business income of birr 1,200,000. What is
the amount of business income tax of the business?
A. Birr 240,000 C. Birr 360,000
B. Birr 420,000 D. Birr 300,000
4. A tax should be levied after considering all favorable and unfavourable factors from
different angles such as economic, political and social. What is this canon called?
A. Canon of Diversity C. Canon of Neutrality
B. Canon of Coordination D. Canon of Expediency
5. Assume that Mr. X is an employee of an Ethiopian federal organization having a basic
salary of birr 12,000 and transportation allowance of birr 2,700. What the amount of
taxable transportation allowance of Mr. X?
A. Birr 3,000 C. Birr 500
B. Birr 800 D. Birr 2,200
6. Assume that XYZ proprietorship has earned an annual rental income of birr 250,000.
What the amount of rental income tax of XYZ proprietorship?
A. Birr 79,500 C. Birr 60,500
B. Birr 69,500 D. Birr 65,500
7. Which of the following DOES NOT belong to the class of fully deductible expenses for
the determination of taxable business income?
A. Donations and Gifts
B. Selling and distribution costs
C. General & administrative expenses
D. Insurance premium directly connected to Business
8. Tax imposed on specific goods and services which are mostly luxury items and harmful
products is?
A. Turn over tax C. Value added tax
B. Excise tax D. Custom duty tax
9. Assume that Mr. X is an employee of an Ethiopian federal organization having a basic
salary of birr 10,000 and transportation allowance of birr 2.600. What is the amount of
employment income tax of Mr. Z?
A. Birr 3,256 C. Birr 2165
B. Birr 1976 D. Birr 2,075
10. Assume that a business owned by an individual has earned an annual business income of
birr 120,000. What is the amount of business income tax of the business?
A. Birr 25,450 C. Birr 24,000
B. Birr24,540 D. Birr 23,220

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