Unit 7 Test Review (Credit & Income)

what a person earns after payroll taxes and other deductions are taken out

• irregular income

• commission

• gross income

• net income

This is the most reliable, consistent form of income. A person who needs financial security might be most comfortable with this form of income.

• Hourly

• Salary

• Tips

• Contractual

Total money you earn before taxes and other deductions.

• Salary
• Net income
• Gross income
• Wages

Gross income is:

• the total amount of money you earn

• the amount of money you receive after decuctions are subtracted

• the total amount of money you spend

• sales taxes on items you buy

This type of income is when you are paid for the level of service you provide to customers (like a waitress)

• salary

• tips

• independent contractor

• hourly wages

Johnny is excited because he worked an extra 10 hours last week - so he knows his next paycheck will be worth more. What type of income does Johnny make?

• salary

• hourly wages

• capital gains

• tips

Fred got to be an extra in a movie over Christmas break. He got paid $120 for his work, and they paid him via Venmo. On January 31, he got a 1099 form from the film company telling him how much he made, and he had to claim this income on his 2022 taxes. What type of income did he earn?

• salary

• capital gains

• dividends

• independent contractor services

CheChe got her quarterly check in the mail for $22.15 from owning Apple stock. What type of income is this?

• dividends

• capital gains

• independent contractor services

• tips

Sophie bought a house in 2018 for $125,000 - but recently sold her house for $175,000. The $50,000 she made when she sold the home is considered what type of income?

• independent contractor services

• dividends

• capital gains

• salary

What is a form 1040?

• The simplest tax form someone can fill out to file their federal taxes.

• A document your employer sends you at the end of the year listing how much money and taxes you paid.

• A document you fill out when you start a new job letting your employer know how much taxes to take out.

• The most common type of pay stub - it lists your hours worked, deductions, taxes, and vacation time.