|Two-tier tax system|
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Definition of Two-tier tax system
Two-tier tax system
A method of taxation in which the income going to shareholders is taxed twice.
Schedule of depreciation rates allowed for tax purposes.
A set of accounts that summarize the transactions of a business that have been recorded on source documents.
a valuation method that uses actual direct
The ratio of net income to net sales.
Money after-tax rate of return minus the inflation rate.
A situation wherein participants in a transaction have different net tax rates.
A racking system using automated systems
taxes as a fraction of income; total taxes divided by total taxable income.
Total taxes owed divided by total income.
The ratio of net income before taxes to net sales.
The tax rate at which a party to a prospective transaction is indifferent between entering
a formal process for gathering and analyzing information and producing intelligence to meet decision making needs; requires information about
Net income plus depreciation.
a system using transfer prices; see transfer
A computerized clearing system for sterling funds
Clearing House Interbank Payments System (CHIPS)
An international wire transfer system for high-value
Corporate tax view
The argument that double (corporate and individual) taxation of equity returns makes
Corporate taxable equivalent
Rate of return required on a par bond to produce the same after-tax yield to
cost control system
a logical structure of formal and/or informal
cost management system (CMS)
a set of formal methods
Current Income Tax Expense
That portion of the total income tax provision that is based on
Current Tax Payment Act of 1943
A federal Act requiring employers to withhold income taxes from employee pay.
Deferred Income Tax Expense
That portion of the total income tax provision that is the result
Deferred Tax Asset
Future tax benefit that results from (1) the origination of a temporary difference
Deferred Tax Liability
Future tax obligation that results from the origination of a temporary
A non-cash expense that provides a source of free cash flow. Amount allocated during the
Depreciation tax shield
The value of the tax write-off on depreciation of plant and equipment.
depreciation tax shield
Reduction in taxes attributable to the depreciation allowance.
Agreement between two countries that taxes paid abroad can be offset against
Du Pont system
A breakdown of ROE and ROA into component ratios.
Dupont system of financial control
Highlights the fact that return on assets (ROA) can be expressed in terms
earnings before interest and income tax (EBIT)
A measure of profit that
Earnings before interest and taxes (EBIT)
A financial measure defined as revenues less cost of goods sold
Earnings before interest and taxes (EBIT)
The operating profit before deducting interest and tax.
Earnings before interest, taxes, depreciation and amortization (EBITDA)
The operating profit before deducting interest, tax, depreciation and amortization.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
An earningsbased measure that, for many, serves as a surrogate for cash flow. Actually consists of working
EBDDT - Earnings before depreciation and deferred taxes
This measure is used principally by
Effective Tax Rate
The total tax provision divided by pretax book income from continuing
The combinations of securities portfolios that maximize expected return for any level of
A graph representing a set of portfolios that maximizes
Electronic Federal Tax Payment Systems (EFTPS)
An electronic funds transfer system used by businesses to remit taxes to the government.
enterprise resource planning (ERP) system
a packaged software program that allows a company to
Enterprise resource planning system
A computer system used to manage all company
Equivalent taxable yield
The yield that must be offered on a taxable bond issue to give the same after-tax
European Monetary System (EMS)
An exchange arrangement formed in 1979 that involves the currencies
Federal Reserve System
The central bank of the U.S., established in 1913, and governed by the Federal
Federal Reserve System
The central banking authority responsible for monetary policy in the United States.
Federal Unemployment Tax Act (FUTA)
A federal Act requiring employers to pay a tax on the wages paid to their employees, which is then used to create a
flexible manufacturing system (FMS)
a production system in which a single factory manufactures numerous variations
Foreign tax credit
Home country credit against domestic income tax for foreign taxes paid on foreign
hybrid costing system
a costing system combining characteristics
Imputation tax system
Arrangement by which investors who receive a dividend also receive a tax credit for
What the business paid to the IRS.
A government tax on the income earned by an individual or corporation.
Income Tax Expense
See income tax provision.
Income Tax Provision
The expense deduction from pretax book income reported on the
taxes paid by consumers when they buy goods and services. A sales tax is an example.
The loss in purchasing power due to inflation eroding the real value of financial assets such as cash.
Canada's bank machine and electronic debit system. If you use your bank card at a bank machine which displays the Interac symbol (and that bank machine is not your bank's machine), you will be charged a fee.
Interest equalization tax
tax on foreign investment by residents of the U.S. which was abolished in 1974.
Interest tax shield
The reduction in income taxes that results from the tax-deductibility of interest payments.
interest tax shield
tax savings resulting from deductibility of interest payments.
Investment tax credit
Proportion of new capital investment that can be used to reduce a company's tax bill
Investment Tax Credit
A reduction in taxes offered to firms to induce them to increase investment spending.
job order costing system
a system of product costing used
Just-in-time inventory systems
systems that schedule materials/inventory to arrive exactly as they are
just-in-time manufacturing system
a production system that attempts to acquire components and produce inventory only as needed, to minimize product defects, and to
Limited-tax general obligation bond
A general obligation bond that is limited as to revenue sources.
system whereby customers send payments to a post office box and a local bank collects and processes checks.
MACRS (Modified Accelerated Cost Recovery System)
A depreciation method created by the IRS under the tax Reform Act of 1986. Companies must use it to depreciate all plant and equipment assets installed after December 31, 1986 (for tax purposes).
management control system (MCS)
an information system that helps managers gather information about actual organizational occurrences, make comparisons against plans,
management information system (MIS)
a structure of interrelated elements that collects, organizes, and communicates
Margin Tax Rate
The tax rate applicable to the last unit of income.
Marginal tax rate
The tax rate that would have to be paid on any additional dollars of taxable income earned.
marginal tax rate
Additional taxes owed per dollar of additional income.
Marginal Tax Rate
Percent of an increase in income paid in tax.
Markowitz efficient frontier
The graphical depiction of the Markowitz efficient set of portfolios
Graph of the lowest possible portfolio variance that is attainable for a given
Modified Accelerated Cost Recovery System (MACRS)
Depreciation method that allows higher tax deductions in early years and lower deductions later.
A technical trading strategy that combines mechanical rules, such as the CRISMA
a flexible organization structure that
Nonmarket or firm-specific risk factors that can be eliminated by diversification. Also
normal cost system
a valuation method that uses actual
system whereby a depositor may write cheques in excess of the balance, with the bank automatically extending a loan to cover the shortage.
Payroll tax expense
The amount of tax associated with salaries that an employer pays to governments (federal, state, and local).
Payroll taxes payable
The amount of payroll taxes owed to the various governments at the end of a period.
performance management system
a system reflecting the entire package of decisions regarding performance measurement and evaluation
Periodic inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold only at the end of the period.
Perpetual inventory system
An inventory system in which the balance in the Inventory account is adjusted for the units sold each time a sale is made.
Personal tax view (of capital structure)
The argument that the difference in personal tax rates between
Planning, programming and budgeting system (PPBS)
A method of budgeting in which budgets are allocated to projects or programmes rather than to responsibility centres.
A bank machine network outside Canada, across the U.S. and internationally. Customers who use a bank machine with a 'PLUS' symbol may be charged a fee.
See market mechanism.
process costing system
a method of accumulating and assigning costs to units of production in companies producing large quantities of homogeneous products;
Profit before interest and taxes (PBIT)
A tax in which the rich pay a larger percentage of income than the poor. Contrast with regressive tax.
Progressive tax system
A tax system wherein the average tax rate increases for some increases in income but
A tax taking the same percentage of income regardless of the level of income.
a production system dictated by product sales
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