Understanding Taxes and Budgeting

What is income tax?

• A tax on the sale of goods and services.

• A tax on the money people earn from working.

• A tax on property ownership.

• A tax deducted from an employee's paycheck.

Which of the following is a payroll tax?

• Tax on groceries.

• Tax on a house.

• Tax deducted from an employee's paycheck.

• Tax on business profits.

What is the main difference between gross income and net income?

• Gross income is after taxes, net income is before taxes.

• Gross income is before taxes, net income is after taxes.

• Gross income includes only salary, net income includes all earnings.

• Gross income is the same as net income.

• $600

• $500

• $400

• $100

Tags

CCSS.7.NS.A.3

Which of the following is an advantage of using a credit card?

• You pay interest on purchases.

• You can build a credit history.

• You need to carry cash.

• You have to pay immediately.

What is a disadvantage of using a debit card?

• You can spend more than you have.

• You need to pay interest.

• It directly deducts money from your bank account.

• It helps build credit history.

What is the first step in balancing a simple budget?

• Spend all your money.

• List all your expenses.

• Save all your income.

• Ignore your income.

• $200

• $1000

• $800

• $1800

Tags

CCSS.7.NS.A.3

Why is it important to keep financial records?

• To spend more money.

• To track income and expenses.

• To avoid paying taxes.

• To confuse yourself.

Which of the following is a financial record?

• A grocery list

• A bank statement

• A novel

• A movie ticket