Explore BrainMass
Share

Economic incidence of tax; prepayment of interest

True and False

1. The person who pays a tax directly to the government bears the economic incidence of the tax.

2. A cash basis taxpayer must account for any prepayment of interest expense under the accrual method.

© BrainMass Inc. brainmass.com June 19, 2018, 1:39 pm ad1c9bdddf

Solution Preview

1. The person who pays a tax directly to the government bears the economic incidence of the tax.

Not necessarily true. Example is that you buy a new shirt at the store and pay the sales tax as part of the total purchase ...

Solution Summary

In two short paragraphs, each question is fully explained together with a true false answer.

$2.19