Gary's Accounting Questions
1. The best place to read your gross earnings on a W-2 is:
(a) Box 1 Wages, tips, other compensation
(b) Box 2 Social Security wages
(c) Box 5 Medicare Wages and tips
(d) Box 16 State wages, tips, etc.
2. Most of the money that retirees get from Social Security comes directly from:
(a) Money from payroll taxes paid by all other workers.
(b) Money from sales of stocks, bonds, mutual funds, and other securities that Social Security invested in with payroll taxes.
(c) Money from the Social Security Trust Fund, because payments to retirees exceed the revenues of payroll taxes.
(d) Money from various emergency trust funds that were created over the past ten years because Social Security went bankrupt.
3. The following statement is true:
(a) United States issued currency circulating today is backed up by gold held by the Treasury department.
(b) The United States budget is not permitted to include more spending than revenues, because that could cause the United States to declare bankruptcy.
(c) The $300 and $600 payments that most Americans got in 2001 from the United States treasury was a refund on their 2001 taxes.
(d) The United States tax system is a progressive tax system, where the tax rate increases as income increases, so the highest-earning individuals pay the highest tax rate.