1. Which of the following best describes "fringe benefits"?
A. Taxable wages
B. Benefits given to employees in addition to regular wages
C. Deductions for retirement plans
D. Overtime pay
Answer: B) Benefits given to employees in addition to regular
wages
Rationale: Fringe benefits are non-wage compensations provided
to employees, such as health insurance, retirement plans, and
company cars.
2. Which of the following would most likely be part of an
employer's payroll responsibilities?
A. Collecting union dues
B. Setting employee salaries
C. Paying quarterly payroll taxes
D. Offering health benefits
Answer: C) Paying quarterly payroll taxes
Rationale: Employers are required to submit payroll taxes to the
IRS quarterly, including Social Security, Medicare, and
unemployment taxes.
,3. Which of the following payroll documents is filed annually with
the IRS?
A. W-4
B. W-2
C. I-9
D. 1099
Answer: B) W-2
Rationale: The W-2 form reports an employee's annual wages and
the taxes withheld, and it is filed with the IRS each year.
4. Which of the following would NOT be considered part of an
employee’s payroll?
A. Salary
B. Commissions
C. Workers' compensation benefits
D. Bonus
Answer: C) Workers' compensation benefits
Rationale: Workers' compensation is a separate benefit from an
employee’s regular payroll, providing financial support in case of
workplace injury.
5. What does the term "FICA" stand for?
, A. Federal Income Contribution Act
B. Federal Insurance Contributions Act
C. Fair Income Contribution Act
D. Federal International Compensation Act
Answer: B) Federal Insurance Contributions Act
Rationale: FICA refers to the Federal Insurance Contributions
Act, which mandates payroll taxes for Social Security and
Medicare.
6. Which of the following is true regarding overtime pay?
A. Overtime pay is required for all employees, regardless of job
duties
B. Overtime pay is calculated as time and a half for hours worked
beyond 40 in a workweek
C. Overtime pay is calculated as double the hourly rate for hours
worked beyond 40 in a workweek
D. Overtime pay is not required for salaried employees
Answer: B) Overtime pay is calculated as time and a half for hours
worked beyond 40 in a workweek
Rationale: Overtime pay is required at a rate of 1.5 times the
regular hourly rate for hours worked beyond 40 in a workweek for
eligible (non-exempt) employees.
A. Taxable wages
B. Benefits given to employees in addition to regular wages
C. Deductions for retirement plans
D. Overtime pay
Answer: B) Benefits given to employees in addition to regular
wages
Rationale: Fringe benefits are non-wage compensations provided
to employees, such as health insurance, retirement plans, and
company cars.
2. Which of the following would most likely be part of an
employer's payroll responsibilities?
A. Collecting union dues
B. Setting employee salaries
C. Paying quarterly payroll taxes
D. Offering health benefits
Answer: C) Paying quarterly payroll taxes
Rationale: Employers are required to submit payroll taxes to the
IRS quarterly, including Social Security, Medicare, and
unemployment taxes.
,3. Which of the following payroll documents is filed annually with
the IRS?
A. W-4
B. W-2
C. I-9
D. 1099
Answer: B) W-2
Rationale: The W-2 form reports an employee's annual wages and
the taxes withheld, and it is filed with the IRS each year.
4. Which of the following would NOT be considered part of an
employee’s payroll?
A. Salary
B. Commissions
C. Workers' compensation benefits
D. Bonus
Answer: C) Workers' compensation benefits
Rationale: Workers' compensation is a separate benefit from an
employee’s regular payroll, providing financial support in case of
workplace injury.
5. What does the term "FICA" stand for?
, A. Federal Income Contribution Act
B. Federal Insurance Contributions Act
C. Fair Income Contribution Act
D. Federal International Compensation Act
Answer: B) Federal Insurance Contributions Act
Rationale: FICA refers to the Federal Insurance Contributions
Act, which mandates payroll taxes for Social Security and
Medicare.
6. Which of the following is true regarding overtime pay?
A. Overtime pay is required for all employees, regardless of job
duties
B. Overtime pay is calculated as time and a half for hours worked
beyond 40 in a workweek
C. Overtime pay is calculated as double the hourly rate for hours
worked beyond 40 in a workweek
D. Overtime pay is not required for salaried employees
Answer: B) Overtime pay is calculated as time and a half for hours
worked beyond 40 in a workweek
Rationale: Overtime pay is required at a rate of 1.5 times the
regular hourly rate for hours worked beyond 40 in a workweek for
eligible (non-exempt) employees.
