PAYROLL FUNDAMENTALS 1 EXAM PREP
UPDATED 2026 PRACTICE QUESTIONS AND
VERIFIED ANSWERS ALREADY GRADED A+
◉Personal Driving includes:. Answer: - vacation travel
- driving to conduct personal business
- travel between home and work, even if the employer insists the
employee drive the vehicle home
◉Business driving includes:. Answer: - driving to existing and
prospective clients, points of call, and other office locations of the
employer
- when an employee travels directly from home to a point of call, which
is not the employer's place of business where the employee regularly
reports for work
- when the employees travels home directly from a point of call
◉Availability (automobiles). Answer: The number of thirty-day periods
that the automobile is available to the employee for the current taxation
year. The employee has access to or control over the vehicle.
,◉Automobile. Answer: A motor vehicle that is designed or adapted to
primarily carry individuals on highways and streets, and has seating
capacity of not more than the driver and eight passengers
◉If a gift or award is given to an employee in cash. Answer: The
amount is considered pensionable, insurable and taxable to the
employee, subject to all statutory deductions
◉Overtime meal allowance is considered non-taxable if (RQ):. Answer:
- overtime is done at the employer's request and is expected to last for at
least two consecutive hours
- overtime is done rarely or on an occasional basis
- the meal expenses are reimbursed upon presentation of receipts
- the meal expenses reimbursed or the value of the meal provided is
reasonable
◉The four categories of employment income. Answer: - Earnings
- Allowances
- Benefits
- Taxable expense reimbursement
◉Earnings. Answer: Dollar amounts the employer pays an employee for
the work they perform
,◉Types of earnings. Answer: - a salary
- a rate for each hour worked
- a rate per piece of goods produced or picked
- a disability payment for time off work due to illness
- a payment for vacation time
- a premium payment for overtime hours worked
- a premium payment for hours worked on shift
◉Allowances. Answer: Additional dollar amounts paid to employees for
the use, or anticipated use, of their personal property for business
purposes
◉Benefits. Answer: Dollar values attributed to something the employer
has either provided to an employee or paid for on an employee's behalf
◉Expense Reimbursements. Answer: Dollar amounts paid to employees
to cover expenses that they incur while performing their job.
◉Regular payments. Answer: Have an established frequency, such as
weekly-paid salary or wages
◉Non-regular payments. Answer: payments that do not occur each pay
period, for example, a bonus or a retroactive adjustment
, ◉Salary. Answer: A fixed amount of money paid to an employee for
each pay period.
◉Salary per pay period. Answer: Annual salary / number of pay periods
per year
◉Wages. Answer: Earnings which are based on the amount of time
worked, usually at a rate per hour or per day
◉Regular earnings. Answer: Hourly rate x pay period regular hours
worked
◉Piecework. Answer: A rate of pay earned per unit of production,
regardless of the length of time taken
◉Self-Insured Disability. Answer: Employers often offer disability
coverage that provides their employees with income in the event of
absence due to illness or injury
◉Sick Pay. Answer: An amount paid to an employee who is absent from
work due to illness or injury. Paid sick leave is only legislated in two
provinces, PEI and Quebec. With the other provinces paid sick leave is
up to the employer.
UPDATED 2026 PRACTICE QUESTIONS AND
VERIFIED ANSWERS ALREADY GRADED A+
◉Personal Driving includes:. Answer: - vacation travel
- driving to conduct personal business
- travel between home and work, even if the employer insists the
employee drive the vehicle home
◉Business driving includes:. Answer: - driving to existing and
prospective clients, points of call, and other office locations of the
employer
- when an employee travels directly from home to a point of call, which
is not the employer's place of business where the employee regularly
reports for work
- when the employees travels home directly from a point of call
◉Availability (automobiles). Answer: The number of thirty-day periods
that the automobile is available to the employee for the current taxation
year. The employee has access to or control over the vehicle.
,◉Automobile. Answer: A motor vehicle that is designed or adapted to
primarily carry individuals on highways and streets, and has seating
capacity of not more than the driver and eight passengers
◉If a gift or award is given to an employee in cash. Answer: The
amount is considered pensionable, insurable and taxable to the
employee, subject to all statutory deductions
◉Overtime meal allowance is considered non-taxable if (RQ):. Answer:
- overtime is done at the employer's request and is expected to last for at
least two consecutive hours
- overtime is done rarely or on an occasional basis
- the meal expenses are reimbursed upon presentation of receipts
- the meal expenses reimbursed or the value of the meal provided is
reasonable
◉The four categories of employment income. Answer: - Earnings
- Allowances
- Benefits
- Taxable expense reimbursement
◉Earnings. Answer: Dollar amounts the employer pays an employee for
the work they perform
,◉Types of earnings. Answer: - a salary
- a rate for each hour worked
- a rate per piece of goods produced or picked
- a disability payment for time off work due to illness
- a payment for vacation time
- a premium payment for overtime hours worked
- a premium payment for hours worked on shift
◉Allowances. Answer: Additional dollar amounts paid to employees for
the use, or anticipated use, of their personal property for business
purposes
◉Benefits. Answer: Dollar values attributed to something the employer
has either provided to an employee or paid for on an employee's behalf
◉Expense Reimbursements. Answer: Dollar amounts paid to employees
to cover expenses that they incur while performing their job.
◉Regular payments. Answer: Have an established frequency, such as
weekly-paid salary or wages
◉Non-regular payments. Answer: payments that do not occur each pay
period, for example, a bonus or a retroactive adjustment
, ◉Salary. Answer: A fixed amount of money paid to an employee for
each pay period.
◉Salary per pay period. Answer: Annual salary / number of pay periods
per year
◉Wages. Answer: Earnings which are based on the amount of time
worked, usually at a rate per hour or per day
◉Regular earnings. Answer: Hourly rate x pay period regular hours
worked
◉Piecework. Answer: A rate of pay earned per unit of production,
regardless of the length of time taken
◉Self-Insured Disability. Answer: Employers often offer disability
coverage that provides their employees with income in the event of
absence due to illness or injury
◉Sick Pay. Answer: An amount paid to an employee who is absent from
work due to illness or injury. Paid sick leave is only legislated in two
provinces, PEI and Quebec. With the other provinces paid sick leave is
up to the employer.
