Question 12 of 25
An business owner earns $100,000 in profits from her company. However, she
has to save up about $25,000 of that money each year to pay the federal
government. This is the result of the:
O A. sales tax
O
B. estate tax.
O C. property tax
O D. income tax

Answer:

income tax

Explanation:

When a business owner earns $100,000 in profits from her company. She has to save up about $25,000 of that money each year to pay the federal government which is the result of income tax.

A business owner earns profit when he/she gains amount from any kind of business activity after accounting for all expenses. However, if the selling price of the product is more than the cost price, then it is considered as a gain or profit.

A Federal Government is a nation's system of designating power. There are three distinct branches of Federal Government- legislative, executive, and judicial, whose powers are vested by the U.S. Constitution.

The citizens of a country are required to pay taxes to the Federal Government. Paying your taxes is considered a civic duty, although doing so is also considered a requirement of the law.

Income tax is a direct tax that a government imposes on income generated by businesses and individuals within their jurisdiction. The income tax which is paid is used by the government in order to fund public services, pay government obligations, provide goods and services for its citizens, and to stabilize the economy.

Hence, option D is correct.

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