1. 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.
2. Which of the following is considered a "deferred
compensation" plan?
A. Health savings account (HSA)
B. 401(k) retirement plan
C. Unemployment insurance
D. Workers' compensation
Answer: B) 401(k) retirement plan
Rationale: A 401(k) is a deferred compensation plan that allows
employees to set aside a portion of their salary for retirement
before taxes.
,3. 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.
4. What is the purpose of a Form I-9?
A. To verify the employee's eligibility to work in the United
States
B. To report an employee's annual earnings to the IRS
C. To calculate the employee’s tax withholdings
D. To establish employee benefits eligibility
Answer: A) To verify the employee's eligibility to work in the
United States
Rationale: The I-9 form is used to verify that employees are
legally authorized to work in the U.S.
, 5. 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.
6. Which of the following payroll taxes does an employer withhold
from employees’ wages but not contribute to itself?
A. Federal income tax
B. Social Security tax
C. Medicare tax
D. State unemployment tax
Answer: A) Federal income tax
Rationale: Employers withhold federal income tax from employee
wages but do not contribute to it—this tax is entirely paid by the
employee.
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.
2. Which of the following is considered a "deferred
compensation" plan?
A. Health savings account (HSA)
B. 401(k) retirement plan
C. Unemployment insurance
D. Workers' compensation
Answer: B) 401(k) retirement plan
Rationale: A 401(k) is a deferred compensation plan that allows
employees to set aside a portion of their salary for retirement
before taxes.
,3. 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.
4. What is the purpose of a Form I-9?
A. To verify the employee's eligibility to work in the United
States
B. To report an employee's annual earnings to the IRS
C. To calculate the employee’s tax withholdings
D. To establish employee benefits eligibility
Answer: A) To verify the employee's eligibility to work in the
United States
Rationale: The I-9 form is used to verify that employees are
legally authorized to work in the U.S.
, 5. 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.
6. Which of the following payroll taxes does an employer withhold
from employees’ wages but not contribute to itself?
A. Federal income tax
B. Social Security tax
C. Medicare tax
D. State unemployment tax
Answer: A) Federal income tax
Rationale: Employers withhold federal income tax from employee
wages but do not contribute to it—this tax is entirely paid by the
employee.
