CPP EXAM TEST BANK | CERTIFIED PAYROLL
PROFESSIONAL EXAM | QUESTIONS AND
CORRECT ANSWERS | GRADED A+ | VERIFIED
ANSWERS | LATEST VERSION | STUDY THIS
ONE!
An employee claims married and two withholding allowances on her 2017
Form W-4, is paid $1,700 biweekly, and defers $50 per pay period to a
401(k) plan. Using the percentage method, what is the total of the biweekly
deductions from the employee's pay for federal income, social security and
Medicare taxes?
A. $245.01
B. $252.51
C. $299.66
D. $114.96 ---------CORRECT ANSWER-----------------A. $245.01
FIT: $1,700 - $50 = $1,650 - (2 x $155.80) - $1,050 = $288.40 x 15% +
$71.70 = $114.96
FICA: $1,700 x 7.65% = $130.05
$114.96 + $130.05 = $245.01
On a company's financial statements, payroll tax expense appears in the:
A.Balance Sheet
B. accrued payroll
C. salaries expense
D. income statement ---------CORRECT ANSWER-----------------D. income
statement
What is the chief advantage of a vendor payroll package>
A. reduced processing time
B. inexpensiveness and ease of installation
C. no required major in-house system development
D. lower cost than a service provider contract ---------CORRECT ANSWER-
----------------C. No required major in-house system development
,Which of the following elements is essential to a disaster recovery plan?
A. an excess supply of checks and direct deposit stubs
B. a compatible off-site remote location to produce payrolls
C. detailed documentation of current company policies
D. a procedure for limiting security system access ---------CORRECT
ANSWER-----------------B, A compatible off-site remote location to produce
payrolls
Which of the following practices is a strong internal control procedure?
A. Have the payroll bank account reconciled in the payroll department
B. Have the payroll manager distribute paychecks
C. place payroll checks under the personal control of the payroll manager
D. have a person other than the person who requested and authorized the
payments prepare the payroll checks ---------CORRECT ANSWER------------
-----D. have a person other than the person who requested and authorized
the payments prepare the payroll checks
During 2017. an employee worked for company A and quit after earning
$130,000. later in the same year the employee was hired by company B.
With respect to social security, Medicare and FUTA, how should company
B treat the employee's earnings as of the first wage payment?
A. start accumulating social security, Medicare, and FUTA wages, and
withhold both social security and Medicare taxes
B. Start accumulating Medicare wages only and withhold medicare tax
C. start accumulating social security, medicare and FUTA wages, but
withhold medicare tax only
D. Start accumulating medicare wages only, but withhold both social
security and medicare taxes ---------CORRECT ANSWER-----------------A.
start accumulating social security, Medicare, and FUTA wages, and
withhold both social security and Medicare taxes
,Which of the following documents proves an employee's identity and
authorization to work?
A. social security card
B. unexpired US Passport
C. birth certificate
D. Form I-9 ---------CORRECT ANSWER-----------------B. unexpired US
passport
How are salaries reflected on the income statement?
A. income
B. assets
C. accruals
D. expenses ---------CORRECT ANSWER-----------------D. Exepenses
An employee is paid a bonus of $1,500 with a regular biweekly wage
payment of $2,000 in 2017 that is indicated separately on the employee's
pay stub. The employee has received no supplemental wages so far this
year. The employee has an elective deferral of 5% of regular wages made
to the 401(k) plan each pay period. For federal income tax withholding
purposes, the company uses the optional flat rate for all bonuses and the
percentage method for regular wage payments. The employee's W-4
claims married with 2 allowances. The employee has no state or local
income taxes or any other deductions. What is the employee's net pay?
A. $2,603.99
B. $2,689.79
C. $2,604.79
D. $2,623.54 ---------CORRECT ANSWER-----------------C. $2,604.79
FIT: $2,000 - $100 = $1,900 - (2x$155.80) = $1,588.40 - $1,050 = ($538.40
x 15%) + $71.70 = $152.46
$1,500 x 25% = $375.00
FICA: $3,500 x 7.65% = $267.75
$2,000 + $1,500 - $100 - $152.46 - $375.00 - $267.75 = $2,604.79
, Which of the following plans describes a cafeteria plan under section 125 of
the Internal Revenue code?
A. a quantified and accountable expense reimbursement plan
B. a tax-qualified retirement plan for public education institutions
C. a plan which permits employees to select from two or more qualified
taxable and nontaxable benefits
D. a plan whereby state government employees may request that pretax
dollars be set aside in a retirement account until age 59 ---------CORRECT
ANSWER-----------------C. a plan which permits employees to select from
two or more qualified taxable and nontaxable benefits
Using federal child support guidelines, calculate the maximum amount of
support that can be withheld from an employee's semimonthly disposable
earnings of $1,500.00. The employee is four months in arrears in making
child support payments and has no other dependents.
A. $750.00
B. $825.00
C. $900.00
D. $975.00 ---------CORRECT ANSWER-----------------D. $975.00
($1500x65%=$975)
Employers in non-credit reduction states that pay their state unemployment
taxes on time can deduct up to what percentage from the full FUTA tax rate
in calculating their FUTA tax payments?
A. 0.6%
B. 4.5%
C. 5.4%
D. 6.0% ---------CORRECT ANSWER-----------------C. 5.4%
Which of the following items determines the disposition of unclaimed
wages?
A. state law only
B. federal law only
C. federal and state law
PROFESSIONAL EXAM | QUESTIONS AND
CORRECT ANSWERS | GRADED A+ | VERIFIED
ANSWERS | LATEST VERSION | STUDY THIS
ONE!
An employee claims married and two withholding allowances on her 2017
Form W-4, is paid $1,700 biweekly, and defers $50 per pay period to a
401(k) plan. Using the percentage method, what is the total of the biweekly
deductions from the employee's pay for federal income, social security and
Medicare taxes?
A. $245.01
B. $252.51
C. $299.66
D. $114.96 ---------CORRECT ANSWER-----------------A. $245.01
FIT: $1,700 - $50 = $1,650 - (2 x $155.80) - $1,050 = $288.40 x 15% +
$71.70 = $114.96
FICA: $1,700 x 7.65% = $130.05
$114.96 + $130.05 = $245.01
On a company's financial statements, payroll tax expense appears in the:
A.Balance Sheet
B. accrued payroll
C. salaries expense
D. income statement ---------CORRECT ANSWER-----------------D. income
statement
What is the chief advantage of a vendor payroll package>
A. reduced processing time
B. inexpensiveness and ease of installation
C. no required major in-house system development
D. lower cost than a service provider contract ---------CORRECT ANSWER-
----------------C. No required major in-house system development
,Which of the following elements is essential to a disaster recovery plan?
A. an excess supply of checks and direct deposit stubs
B. a compatible off-site remote location to produce payrolls
C. detailed documentation of current company policies
D. a procedure for limiting security system access ---------CORRECT
ANSWER-----------------B, A compatible off-site remote location to produce
payrolls
Which of the following practices is a strong internal control procedure?
A. Have the payroll bank account reconciled in the payroll department
B. Have the payroll manager distribute paychecks
C. place payroll checks under the personal control of the payroll manager
D. have a person other than the person who requested and authorized the
payments prepare the payroll checks ---------CORRECT ANSWER------------
-----D. have a person other than the person who requested and authorized
the payments prepare the payroll checks
During 2017. an employee worked for company A and quit after earning
$130,000. later in the same year the employee was hired by company B.
With respect to social security, Medicare and FUTA, how should company
B treat the employee's earnings as of the first wage payment?
A. start accumulating social security, Medicare, and FUTA wages, and
withhold both social security and Medicare taxes
B. Start accumulating Medicare wages only and withhold medicare tax
C. start accumulating social security, medicare and FUTA wages, but
withhold medicare tax only
D. Start accumulating medicare wages only, but withhold both social
security and medicare taxes ---------CORRECT ANSWER-----------------A.
start accumulating social security, Medicare, and FUTA wages, and
withhold both social security and Medicare taxes
,Which of the following documents proves an employee's identity and
authorization to work?
A. social security card
B. unexpired US Passport
C. birth certificate
D. Form I-9 ---------CORRECT ANSWER-----------------B. unexpired US
passport
How are salaries reflected on the income statement?
A. income
B. assets
C. accruals
D. expenses ---------CORRECT ANSWER-----------------D. Exepenses
An employee is paid a bonus of $1,500 with a regular biweekly wage
payment of $2,000 in 2017 that is indicated separately on the employee's
pay stub. The employee has received no supplemental wages so far this
year. The employee has an elective deferral of 5% of regular wages made
to the 401(k) plan each pay period. For federal income tax withholding
purposes, the company uses the optional flat rate for all bonuses and the
percentage method for regular wage payments. The employee's W-4
claims married with 2 allowances. The employee has no state or local
income taxes or any other deductions. What is the employee's net pay?
A. $2,603.99
B. $2,689.79
C. $2,604.79
D. $2,623.54 ---------CORRECT ANSWER-----------------C. $2,604.79
FIT: $2,000 - $100 = $1,900 - (2x$155.80) = $1,588.40 - $1,050 = ($538.40
x 15%) + $71.70 = $152.46
$1,500 x 25% = $375.00
FICA: $3,500 x 7.65% = $267.75
$2,000 + $1,500 - $100 - $152.46 - $375.00 - $267.75 = $2,604.79
, Which of the following plans describes a cafeteria plan under section 125 of
the Internal Revenue code?
A. a quantified and accountable expense reimbursement plan
B. a tax-qualified retirement plan for public education institutions
C. a plan which permits employees to select from two or more qualified
taxable and nontaxable benefits
D. a plan whereby state government employees may request that pretax
dollars be set aside in a retirement account until age 59 ---------CORRECT
ANSWER-----------------C. a plan which permits employees to select from
two or more qualified taxable and nontaxable benefits
Using federal child support guidelines, calculate the maximum amount of
support that can be withheld from an employee's semimonthly disposable
earnings of $1,500.00. The employee is four months in arrears in making
child support payments and has no other dependents.
A. $750.00
B. $825.00
C. $900.00
D. $975.00 ---------CORRECT ANSWER-----------------D. $975.00
($1500x65%=$975)
Employers in non-credit reduction states that pay their state unemployment
taxes on time can deduct up to what percentage from the full FUTA tax rate
in calculating their FUTA tax payments?
A. 0.6%
B. 4.5%
C. 5.4%
D. 6.0% ---------CORRECT ANSWER-----------------C. 5.4%
Which of the following items determines the disposition of unclaimed
wages?
A. state law only
B. federal law only
C. federal and state law
