Test Bank For Business Math
Chapter 1 Test
Multiple Choice
Identify the choice that best completes the statement or answers the question.
1. Which term describes an employee who receives a fixed amount each day?
a. tip c. hourly
b. per diem d. commission
2. What is another name for simple average?
a. estimate c. best approximation
b. mean d. median
3. Which of the following is NOT a step in finding the gross wages for an employee who has worked both
regular time and overtime hours?
a. Find the employee’s average annual income over the past 3 years.
b. Find the overtime pay rate or rates.
c. Add the regular-time pay and the overtime pay.
d. Find the number of regular-time and overtime hours worked.
4. Typically a piece-rate employee is paid only for
a. the total number of rejected pieces produced.
b. the total number of usable pieces produced.
c. the total number of usable pieces produced plus the number of hours worked.
d. none of the above
5. Which type of employee is most likely to earn a base salary plus commission?
a. a construction worker c. a salesperson
b. a waitress d. a lawyer
6. Which type of employee is most likely to earn an hourly wage plus tips?
a. a professional athlete c. a teacher
b. a computer salesperson d. a waiter
Completion
Complete each statement.
7. A fixed amount of money paid to an employee for each time period worked, such as a day, week, month, or
year, is called a(n) .
8. Employees whose rate of commission increases as their sales increase are paid a(n)
.
9. Overtime pay that is figured at one and a half times the regular rate is called .
10. The total amount of money that an employee is paid is called .
1
, Test Bank For Business Math
Chapter 1 Test (cont’d)
Numeric Response
11. Carl is paid an hourly rate of $12.65. What is his weekly gross pay if he works 25 hours per week?
12. Marilyn earns a monthly salary of $3,400. What are her yearly earnings?
13. William is paid a straight commission of 7.25% on all sales. Last week his sales totaled $10,300. What were
his commission earnings last week?
14. Maria earned $5,250, $4,800, $3,990, and $5,120 from her home business during the last four months. What
was her average monthly income during this period?
15. What tip would a waiter receive if a customer adds a 20% tip to a meal that costs $42.18?
16. Donald earns a commission of 3.7% on all sales above his weekly quota of $12,500. His sales last week
totaled $32,480. What commission amount did Donald earn last week?
17. Michelle works at a beauty salon. Last month she received an average tip of $9 from her 88 clients. What was
her tip income for the month?
18. The average annual income for five salespeople last year was $54,200. Four of the salespeople earned these
annual amounts: $58,125, $53,190, $48,975, and $56,000. What was the annual income of the fifth
salesperson?
Short Answer
19. How is gross pay calculated for salaried employees?
20. How do you find the gross wages of an employee who has worked both regular time and overtime?
2
, Test Bank For Business Math
Chapter 2 Test
Multiple Choice
Identify the choice that best completes the statement or answers the question.
1. Which of the following is an example of a job benefit?
a. paid holidays c. child care
b. recreational facilities d. all of the above
2. Which of the following describes how to calculate net pay?
a. Subtract the total deductions from the net pay.
b. Add the total deductions to the gross pay.
c. Subtract the total deductions from the gross pay.
d. Subtract the total deductions from the take-home pay.
3. Workers may claim one withholding allowance for which of the following?
a. themselves c. each child or dependent
b. their spouse d. all of the above
4. Which of the following statements about cafeteria plans is true?
a. Employees direct employers to deduct a certain amount of money from wages before
taxes.
b. These before-tax deductions reduce taxable income.
c. Qualified expenses include life or health insurance premiums, childcare, or healthcare
expenses.
d. all of the above
5. Which of the following statements about Social Security and Medicare taxes is NOT true?
a. The Social Security tax rate of 6.2% is applied to a maximum wage of $102,000.
b. The taxes are used to provide disability, retirement, and survivors’ benefits.
c. The taxes are used to provide hospital insurance for some disabled people and for people
over 65.
d. none of the above
6. Which of the following describes how to calculate take-home pay as a percentage of gross pay?
a. Divide total deductions by gross pay.
b. Divide take-home pay by gross pay.
c. Divide total deductions by take-home pay.
d. Multiply gross pay by 67%.
Completion
Complete each statement.
7. In a tax system, the tax rate gets higher as the taxable income gets larger.
8. A(n) is an amount of income per person that is free from tax.
9. Examples of may include union dues, commuting expenses, uniforms, licenses, and
tools.
3
, Test Bank For Business Math
10. A(n) is an amount of money subtracted from gross pay.
4
Chapter 1 Test
Multiple Choice
Identify the choice that best completes the statement or answers the question.
1. Which term describes an employee who receives a fixed amount each day?
a. tip c. hourly
b. per diem d. commission
2. What is another name for simple average?
a. estimate c. best approximation
b. mean d. median
3. Which of the following is NOT a step in finding the gross wages for an employee who has worked both
regular time and overtime hours?
a. Find the employee’s average annual income over the past 3 years.
b. Find the overtime pay rate or rates.
c. Add the regular-time pay and the overtime pay.
d. Find the number of regular-time and overtime hours worked.
4. Typically a piece-rate employee is paid only for
a. the total number of rejected pieces produced.
b. the total number of usable pieces produced.
c. the total number of usable pieces produced plus the number of hours worked.
d. none of the above
5. Which type of employee is most likely to earn a base salary plus commission?
a. a construction worker c. a salesperson
b. a waitress d. a lawyer
6. Which type of employee is most likely to earn an hourly wage plus tips?
a. a professional athlete c. a teacher
b. a computer salesperson d. a waiter
Completion
Complete each statement.
7. A fixed amount of money paid to an employee for each time period worked, such as a day, week, month, or
year, is called a(n) .
8. Employees whose rate of commission increases as their sales increase are paid a(n)
.
9. Overtime pay that is figured at one and a half times the regular rate is called .
10. The total amount of money that an employee is paid is called .
1
, Test Bank For Business Math
Chapter 1 Test (cont’d)
Numeric Response
11. Carl is paid an hourly rate of $12.65. What is his weekly gross pay if he works 25 hours per week?
12. Marilyn earns a monthly salary of $3,400. What are her yearly earnings?
13. William is paid a straight commission of 7.25% on all sales. Last week his sales totaled $10,300. What were
his commission earnings last week?
14. Maria earned $5,250, $4,800, $3,990, and $5,120 from her home business during the last four months. What
was her average monthly income during this period?
15. What tip would a waiter receive if a customer adds a 20% tip to a meal that costs $42.18?
16. Donald earns a commission of 3.7% on all sales above his weekly quota of $12,500. His sales last week
totaled $32,480. What commission amount did Donald earn last week?
17. Michelle works at a beauty salon. Last month she received an average tip of $9 from her 88 clients. What was
her tip income for the month?
18. The average annual income for five salespeople last year was $54,200. Four of the salespeople earned these
annual amounts: $58,125, $53,190, $48,975, and $56,000. What was the annual income of the fifth
salesperson?
Short Answer
19. How is gross pay calculated for salaried employees?
20. How do you find the gross wages of an employee who has worked both regular time and overtime?
2
, Test Bank For Business Math
Chapter 2 Test
Multiple Choice
Identify the choice that best completes the statement or answers the question.
1. Which of the following is an example of a job benefit?
a. paid holidays c. child care
b. recreational facilities d. all of the above
2. Which of the following describes how to calculate net pay?
a. Subtract the total deductions from the net pay.
b. Add the total deductions to the gross pay.
c. Subtract the total deductions from the gross pay.
d. Subtract the total deductions from the take-home pay.
3. Workers may claim one withholding allowance for which of the following?
a. themselves c. each child or dependent
b. their spouse d. all of the above
4. Which of the following statements about cafeteria plans is true?
a. Employees direct employers to deduct a certain amount of money from wages before
taxes.
b. These before-tax deductions reduce taxable income.
c. Qualified expenses include life or health insurance premiums, childcare, or healthcare
expenses.
d. all of the above
5. Which of the following statements about Social Security and Medicare taxes is NOT true?
a. The Social Security tax rate of 6.2% is applied to a maximum wage of $102,000.
b. The taxes are used to provide disability, retirement, and survivors’ benefits.
c. The taxes are used to provide hospital insurance for some disabled people and for people
over 65.
d. none of the above
6. Which of the following describes how to calculate take-home pay as a percentage of gross pay?
a. Divide total deductions by gross pay.
b. Divide take-home pay by gross pay.
c. Divide total deductions by take-home pay.
d. Multiply gross pay by 67%.
Completion
Complete each statement.
7. In a tax system, the tax rate gets higher as the taxable income gets larger.
8. A(n) is an amount of income per person that is free from tax.
9. Examples of may include union dues, commuting expenses, uniforms, licenses, and
tools.
3
, Test Bank For Business Math
10. A(n) is an amount of money subtracted from gross pay.
4
