Which of the following statements is not true regarding municipal bonds?
A) They are issued by state and local governments.
B) They are free from the risk of default.
C) The interest is exempt from federal income taxes.
D) The interest is exempt from state taxes if the investor resides in the state where the bond was issued.
Answer: B
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The journal entry made on the date of declaration of a cash dividend to common stockholders includes
a. a debit to Cash Dividends and a credit to Common Dividends Payable. b. a debit to Cash Dividends and a credit to Cash. c. a debit to Common Dividends Payable and a credit to Cash Dividends. d. a debit to Cash and a credit to Common Dividends Payable.
Using the straight-line depreciation method will cause a company to incur ____ tax expense in the early years of an asset's life than they would experience using an accelerated method of depreciation
a. more b. less c. equal d. This cannot be determined from the information given.
Which of the following is not an application of accrual accounting?
A) Recognizing revenues when earned and expenses when incurred. B) Applying the matching rule. C) Adjusting the accounts. D) Recording on the basis of actual receipt and payment of cash.
A(n) __________ is an agreement by a lender to replace a construction loan with a permanent loan, usually after certain conditions, such as the timely completion of the project, have been met
a. substitution agreement b. interim agreement c. development commitment d. take-out commitment