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FPC Exam Fundamental Payroll Questions
What is the FUTA tax rate? - Correct Answer-6.0%
On form 941, the employer reports - Correct Answer-Social Security
Wages
What is the formula for calculating an employee’s net pay? - Correct
Answer-Gross pay-deductions for taxes- other deductions
Which plan discriminates in favor of highly compensated employees? -
Correct Answer-Nonqualified deferred compensation plans
What is the federal minimum wage per hour on January 1, 2018? -
Correct Answer-$7.25
What law determines time limits with which employees must be paid
after wages are earned? - Correct Answer-State Laws
Cafeteria plans are authorized by what internal revenue code section? -
Correct Answer-125
The direct deposit data sent to the bank after payroll processing is an
example of - Correct Answer-Interface
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What taxes, if any, must be withheld from payments to an independent
contractor who provided a tin? - Correct Answer-No taxes are withheld
An external audit: - Correct Answer-Allows an objective assessment of
the financial statements.
Employees' privacy rights are governed by all of the following except: -
Correct Answer-Local Legislation
Under the FLSA, what basis is used to determine whether a non-exempt
employee is to be paid overtime? - Correct Answer-Hours worked in a
work week
Overtime payments are included in the calculation of what tax, if any? -
Correct Answer-They are included in all tax calculations
What is the 2018 wage base for social security tax? - Correct Answer-
$128,400.00
If an employee does not have federal tax withheld and has not claimed
exempt, what must the employer do? - Correct Answer-Provide the
employee with the EITC notice
A computerized payroll system can help a payroll dept. accomplish all of
the following tasks except: - Correct Answer-Recognize changes in laws
and regulations
An employee's profit-sharing bonus is payable in the year following his
death. How should the bonus be taxed and reported? - Correct Answer-
Withhold no taxes and report the bonus on for 1099-misc.
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, 3
In what ways can a computerized system increase the accuracy of
employee’s paychecks? - Correct Answer-By reducing human error
What federal taxes must an employer withhold from an employee
reported tips? - Correct Answer-Federal income, social security and
Medicare tax
The main purpose of batch controls is to - Correct Answer-Validate data
entry accuracy
Which of the following types of compensation is taxable? - Correct
Answer-Backpay awards
What is used when calculating an employee's gross up? - Correct
Answer-Net set
Employees can provide their employer with their marital status and
allowances for income tax withholding purposes by: - Correct Answer-
Completing form W-4
Generally, what is the largest expense for most companies? - Correct
Answer-Salaries and benefits
What authority controls the frequency with which employees must be
paid? - Correct Answer-State Laws
What is the general ledger? - Correct Answer-A record of transactions by
account
3
FPC Exam Fundamental Payroll Questions
What is the FUTA tax rate? - Correct Answer-6.0%
On form 941, the employer reports - Correct Answer-Social Security
Wages
What is the formula for calculating an employee’s net pay? - Correct
Answer-Gross pay-deductions for taxes- other deductions
Which plan discriminates in favor of highly compensated employees? -
Correct Answer-Nonqualified deferred compensation plans
What is the federal minimum wage per hour on January 1, 2018? -
Correct Answer-$7.25
What law determines time limits with which employees must be paid
after wages are earned? - Correct Answer-State Laws
Cafeteria plans are authorized by what internal revenue code section? -
Correct Answer-125
The direct deposit data sent to the bank after payroll processing is an
example of - Correct Answer-Interface
1
, 2
What taxes, if any, must be withheld from payments to an independent
contractor who provided a tin? - Correct Answer-No taxes are withheld
An external audit: - Correct Answer-Allows an objective assessment of
the financial statements.
Employees' privacy rights are governed by all of the following except: -
Correct Answer-Local Legislation
Under the FLSA, what basis is used to determine whether a non-exempt
employee is to be paid overtime? - Correct Answer-Hours worked in a
work week
Overtime payments are included in the calculation of what tax, if any? -
Correct Answer-They are included in all tax calculations
What is the 2018 wage base for social security tax? - Correct Answer-
$128,400.00
If an employee does not have federal tax withheld and has not claimed
exempt, what must the employer do? - Correct Answer-Provide the
employee with the EITC notice
A computerized payroll system can help a payroll dept. accomplish all of
the following tasks except: - Correct Answer-Recognize changes in laws
and regulations
An employee's profit-sharing bonus is payable in the year following his
death. How should the bonus be taxed and reported? - Correct Answer-
Withhold no taxes and report the bonus on for 1099-misc.
2
, 3
In what ways can a computerized system increase the accuracy of
employee’s paychecks? - Correct Answer-By reducing human error
What federal taxes must an employer withhold from an employee
reported tips? - Correct Answer-Federal income, social security and
Medicare tax
The main purpose of batch controls is to - Correct Answer-Validate data
entry accuracy
Which of the following types of compensation is taxable? - Correct
Answer-Backpay awards
What is used when calculating an employee's gross up? - Correct
Answer-Net set
Employees can provide their employer with their marital status and
allowances for income tax withholding purposes by: - Correct Answer-
Completing form W-4
Generally, what is the largest expense for most companies? - Correct
Answer-Salaries and benefits
What authority controls the frequency with which employees must be
paid? - Correct Answer-State Laws
What is the general ledger? - Correct Answer-A record of transactions by
account
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