ACCT 1130 Final Exam Study Guide 115 Questions with Verified Answers,100% CORRECT, Exams of Business Economics

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ACCT 1130 Final Exam Study Guide 115 Questions with

Verified Answers

Which of the following is NOT a privacy act specifically pertaining to payroll records? A) Computer fraud and abuse act B) U.S. department of labor OCFO- C) Freedom of information act D) Community property act - CORRECT ANSWER C) Freedom of information act Why is outsourced payroll popular among accounting professionals? - CORRECT ANSWER Time demands for payroll processing decrease Congress passed the _____ and _____ to assist displaced workers - CORRECT ANSWER Federal unemployment tax act, social security insurance act According to PCAOB, personal or family ownership in excess of five percent of a client's business may compromise payroll accountant's _____ - CORRECT ANSWER Objectivity and independence A provision of the _____ made managers and supervisors ineligible to participate in the tip pools, when used for tipped employees - CORRECT ANSWER Consolidated appropriations act Pay cards represent a trend in payroll disbursement that alleviates the employee's need for a _____ - CORRECT ANSWER Bank account The _____ mandated employer verification and reporting of an employee's legal ability to work in the United States - CORRECT ANSWER Immigration reform and control act of 1986 Which of the following is true about independent contractors within the context of payroll?

A) the worker controls hours worked and exercises judgement B) they are employees of the company C) a temporary working relationship must exist D) tools and facilities are provided by the employer - CORRECT ANSWER A) the worker controls hours worked and exercises judgment Why do different methods of time collection devices exist among companies? - CORRECT ANSWER They promote accurate time measurement Contemporary payroll practices reflect _____ - CORRECT ANSWER The transition to internet- or cloud-based accounting software Which form does the Internal Revenue Service used to keep track of employees? - CORRECT ANSWER W- _____ is required under the Davis-Bacon act for employers who engage with federal contracts - CORRECT ANSWER Certified payroll Companies use _____ and _____ to allow employees to have rapid electronic access to their compensation - CORRECT ANSWER Direct deposit, paycards The _____ represented sweeping changes to the tax code, and reframed the computation of employee income tax - CORRECT ANSWER Tax cuts and jobs act An accountant must remain impartial in all dealings, according to the ethical principle of _____ - CORRECT ANSWER Objectivity and independence An example of an accounting software package that fosters cloud-based payroll processing is _____ - CORRECT ANSWER QuickBooks The _____ Prohibited discrimination based on race, creed, color, gender, or national origin - CORRECT ANSWER Civil rights act of 1964 Payment of prevailing local wages for government contractors was mandated by the _____ - CORRECT ANSWER Davis-Bacon act

He consolidated appropriations act, included an increase in funding for the _____ program - CORRECT ANSWER E-verify Employees may be classified as exempt or nonexempt, because of provisions of the _____ - CORRECT ANSWER Fair labor standards act What is the difference in pay practices between salaried exempt and salaried nonexempt workers? - CORRECT ANSWER Salaried nonexempt workers may be eligible for overtime pay. If a firm pays its employees semi monthly, how often does a dispersed employee compensation? - CORRECT ANSWER Twice per month Which pay frequency usually has 26 pay periods - CORRECT ANSWER Bi-weekly A _____ employee is not eligible for company benefits whereas a _____ employee is eligible - CORRECT ANSWER Temporary, leased Roland is terminated by a company in Alabama according to state regulations, when must he received his final pay? - CORRECT ANSWER No standardized state guidelines exist According to the fair labor standards act, nonexempt workers receive overtime for _____ - CORRECT ANSWER Hours worked in excess of 40 per week. Payroll records that pertain to employees who have committed fraud or other legal actions must be _____ - CORRECT ANSWER Retained indefinitely Mira is a new employee of justice sports. to establish her identity and employment authorization, she could present _____ - CORRECT ANSWER Her current United States passport Christin is a nonexempt employee who works for a firm that has an elected work week composed of four 10 hour days and pays overtime after 40 hours worked per week. What is the rule about overtime for her work situation? - CORRECT ANSWER She receives overtime only when she works past 40 hours in any given week

As a best practice, the employer should have the employee complete a new form W-4 when? - CORRECT ANSWER Every January 1st Form I-9 is issued by the _____ to verify employment eligibility in the United States - CORRECT ANSWER Department of homeland security Which pay frequency has 24 pay periods per year - CORRECT ANSWER Semimonthly Which aspect of internal controls for payroll relates to the Sarbanes-Oxley act - CORRECT ANSWER Cross-training employees and altering duties All executive compensation must be _____ - CORRECT ANSWER Annotated as to derivation and benchmarks Which of the following parties does NOT legally have access to a firms payroll records? A) vendors of the firm B) the department of homeland security C) state revenue department employees D) the IRS - CORRECT ANSWER A) vendors of the firm Which items must be contained in every hiring packet, issued by an employer? - CORRECT ANSWER No items are mandated for issuance in a hiring packet Why must pay rate information be a part of an employees payroll file? - CORRECT ANSWER To ensure that the employee receives all compensation earned What is the difference between termination and resignation, as far as final pay is concerned? - CORRECT ANSWER Resignation pay may be paid at the next regular pay date, but termination pay is subject to state law Verification of hours worked, and pay accuracy is part of the _____ - CORRECT ANSWER Payroll review process

Which of the following is an example of an exempt salaried employee? A) machine operator B) accounting clerk C) administrative assistant D) controller - CORRECT ANSWER D) controller Dru is a cook at a local restaurant and earns $11.20 per hour. He occasionally serves as the crew chief for which he receives an additional $3.00 per hour. during a biweekly pay period, he had the following time data: Cook: 80hrs (including 8 hrs overtime) Crew Chief: 13hrs His gross pay for the pay period would be _____ - CORRECT ANSWER $1125. The minimum wage for salaried employees is _____ - CORRECT ANSWER $684 per week Gil works for a bakery as a cake decorator and receives a base annual salary of $30,000 (paid weekly) as well as piece-rate pay of $175 for any wedding cake that he decorates. His piece-rate earnings are totaled on a monthly basis and are paid on the first pay date of the following month. during the month of June he decorated 18 wedding cakes with a total retail value of $4850. What is gills gross pay for the first week in July? - CORRECT ANSWER $3276. Which of the following is NEVER true about employees who are subject to the tipped wage minimum A) the minimum wage for tipped employees is consistent among all states B) they are paid the minimum wage for the state or local area C) they earn occasional tips from other employees D) they earn more than 10% of their income from tips - CORRECT ANSWER A) the minimum wage for tipped employees is consistent among all states Byron is an inside sales person who earns a base annual salary of $39,000 plus a 5% commission on total sales that he makes during the pay period. During a

biweekly. He made $27,500 in sales. What is Byron's gross pay for the period? - CORRECT ANSWER $2875. A nonexempt salaried worker who received $38,250 in annual compensation for a 35-hour standard workweek has an overtime rate of _____ - CORRECT ANSWER $31. William is a full-time student at an automotive repair vocational school. He works for a local car repair garage and works 30 hours per week. The minimum wage is the same as the federal minimum wage. his gross pay per week is _____ - CORRECT ANSWER $163. Full-time students in a vocational education program who work in a related job may receive 75% of the federal minimum wage. The difference between the tipped employee minimum wage and the federal minimum wage is called the _____ - CORRECT ANSWER Tip credit Glenn is a salaried nonexempt employee who earns annually $48,750 for a 35- hour workweek that is paid semimonthly. He is occasionally on-call for his employer. during the on-call time Glenn is required to be available for phone calls and must have Internet access but he's otherwise able to pursue his own interests. company policy allows for four hours of regular pay for each day that the employee is on-call. how much should Glenn's gross pay be for a pay period in which he's on call for three days? - CORRECT ANSWER $2352. Brad, 18 years of age, is an hourly worker in his colleges bookstore in New Hampshire. He works 25 hours during a two week pay period in his second month of work for the bookstore. The minimum gross pay that he may receive for that two week period is _____ - CORRECT ANSWER $106. Employees under the age of 20 may receive $4.25 per hour for the first 90 days of employment George is a salaried exempt worker who earns $72,630 per year for 45 hour workweek. during a biweekly pay period he worked 105 hours. What is his gross pay? - CORRECT ANSWER $2793.

Jesse works at Hemshaw paper mill as a machine operator, which of the following pay bases would be the most appropriate for him? A) salary B) piece-rate C) hourly D) commission - CORRECT ANSWER C) hourly The difference between the federal minimum wage in the tipped wage involves _____ - CORRECT ANSWER An examination of state and local laws for the job type Comparing the sum of rows and columns, is known by the term _____ - CORRECT ANSWER Prove Evie is an employee who is required to be on-call at her employer's site once per month for eight hours. she earns a salary of $38,000 per year for a 37.5 hour work week and is paid biweekly. What is Evie's gross pay for a pay period that includes on-call time. - CORRECT ANSWER $1617. Which of the following is a class of worker that may receive an hourly rate below the federal minimum wage? A) a 23-year-old employee in the first 90 days of work B) disabled employees in occupations related to their disability C) 18-year-old student in a vocational education program D) a student learner working at a local fast food restaurant - CORRECT ANSWER C) 18-year-old student in a vocational education program According to publication 15 B, what is the annual cash value limit for excluded, nonqualified, achievement, awards? - CORRECT ANSWER $ Emile works for a governmental agency and is given a car for work related and commute purposes. During the last calendar year, he worked 250 days and had a commute of 7 miles each direction. What is the amount of the company car fringe benefit that will appear on his W-2 - CORRECT ANSWER $5250.

$1.50 per mile The primary difference between pretax and post-tax deductions is _____ - CORRECT ANSWER Pretax deductions do not include child support What is the term for an account set aside for an individual in a bank or mutual fund account? - CORRECT ANSWER IRA What is the major limitation of a 457 retirement plan? - CORRECT ANSWER 457 plans are offered to governmental and certain non-governmental employees If a fringe benefit involves a deduction from employee pay, which of the following is true? A) a list of itemize deductions must appear on the employees pay advice B) the employee must enroll in direct deposit, or use a pay card to receive their pay C) employers may only offer the benefit to certain classes of employees D) the fringe benefit is always subject to income tax - CORRECT ANSWER A) a list of itemized deductions must appear on the employees pay advice Darien is an employee and drives a 2021 Chevrolet volt as a company car. The fair market value of the car is $44,000 and the lease value is $11,750 according to publication 15 B. The car has been available for 300 days during the year and Darien has driven 6750 of the 28,350 miles for personal use. He pays for his own fuel. What is the percentage of miles driven for personal use using the lease value rule? - CORRECT ANSWER 23.81% 6750/28350=. Contributions to FSA's in excess of what annual amount (as of 2021) are treated as taxable income - CORRECT ANSWER $2750. Which of the following is true about employer provided snacks and meals? A) all employer provided snacks and meals are taxable B) occasionally provided snacks, and meals are considered de minimis

C) snacks, and meals provided on a regular basis are considered de minimis D) holiday parties, and meals provided at special gatherings are always taxable - CORRECT ANSWER B) occasionally provided snacks, and meals are considered de minimis Under what condition is an employer offered gym membership fringe benefit taxable? - CORRECT ANSWER When the gym membership is not on the employers premises, or added to an employees taxable compensation Which of the following must accompany a high deductible health plan (HDHP) to be considered part of a cafeteria plan A) FSA B) POP C) IRA D) HSA - CORRECT ANSWER D) HSA Employer contributions to employee health insurance must be _____ - CORRECT ANSWER Reported on the employees form W- Forest is a full-time employee in Marlborough South Dakota who earns $58, annually paid biweekly. He's federal income tax is $287. What is the maximum amount that may be withheld from his pay for a child support garnishment assuming he is not in arrears and is not supporting another spouse - CORRECT ANSWER $1073. (Look in textbook ch4 for why) What is the difference between a defined benefit and a defined contribution retirement plan - CORRECT ANSWER The employer guarantees a specific retirement income for defined benefit plans Employees benefit from POP's because they reduce _____ - CORRECT ANSWER Income tax liability According to the consumer credit protection act, what is a limit on the amount of a garnishment for student loans with respect to federal minimum wage weekly

earnings - CORRECT ANSWER It cannot exceed 15% of an employees disposable income Madeline is a government employee who is provided a car for commuting and other work related purposes only. In the last calendar year her commute is 24 miles each way and she worked 220 days. What is the amount of the company car fringe benefit they will appear on her W-2. - CORRECT ANSWER $15,840. (Check textbook ch4 for why) Alec is an employee who drives a 2021 Ford C max with a fair market value of $32,000. He has been given the choice to have the fringe benefit reported on his W-2, either using the lease value rule, or the cents per mile rule. The lease value is $8750 according to publication 15 B. Alec drove 30,258 miles 7552 of it was for personal use. All gasoline was provided by the employer and the amount for personal use was charged back to Alec at $0.055 per mile. If the car was available for 175 days during the year, what is the prorated annual lease percentage using the lease value rule? - CORRECT ANSWER 47.95% 175/365= 0. What are hallmarks of flexible spending accounts (FSA's) and health savings accounts (HSA's) - CORRECT ANSWER FSA's expire on an annual basis but HSA's continue perpetually If a fringe benefit is an investment, when does the investment transfer occur? - CORRECT ANSWER When the amount of the employee contribution is withheld The percentage method of determining an employees, federal income tax deductions _____ - CORRECT ANSWER Considers deductions for dependents and additions for other income The annual payroll tax guide with tax withholding amounts distributed by the IRS is called _____ - CORRECT ANSWER Publication 15 T What is an advantage of pay cards from the employees perspective? - CORRECT ANSWER Direct access to compensation on the paydate

Which of the following is true about direct deposit as a method of paying employees? - CORRECT ANSWER Direct deposit is the most convenient pain method for employers which of the following is an indicator of possible payroll check fraud - CORRECT ANSWER Absence of the bank or recipient address The percentage of the Medicare tax withholding _____ - CORRECT ANSWER Is the same for every employee earning less than $142, The tax cuts and jobs act of 2017 changed the process of determining federal tax withholding amount as of _____ - CORRECT ANSWER January 1, 2020 An employees disposable income is _____ - CORRECT ANSWER And employees pay minus legally required deductions The factors that determine an employees federal income tax, withholding are _____ - CORRECT ANSWER Number of dependents under 17, other dependents, marital status, and taxable pay Why do employers use paper checks as a method of dispersing employee pay? - CORRECT ANSWER Paying employees by check requires a traceable account for employee payments _____ allows firms to allocate labor cost by any measure they need for managerial analysis - CORRECT ANSWER Benefit analysis A _____ reflects the total of salary/wages, bonuses benefits and employer paid costs in an employees pay - CORRECT ANSWER Total compensation report Sol Luna ceramics has been a monthly schedule depositor. During the current year they experienced an economic turn down during which the firm had to lay off all but one employee. Their payroll taxes have decreased to less than $500 per year which form should they file to reconcile their taxes? - CORRECT ANSWER Form 944

Employee compensation, such as the minimus, fringe benefits, regular benefits, and tax matching, may amount to at least another _____ of each employees annual pay - CORRECT ANSWER 50% Plutonium casting has 30 employees who are distributed as follows Design 4 Fabrication 10 Purchasing 8 Administration 3 Sales 5 The payroll related cost for the year are $568,096 if plutonium casting does use departmental classification how much is allocated to the sales department - CORRECT ANSWER $94,682. Cost per employee x number of employees in dept Luke's apiaries operates as a Wisconsin business. The employees annual earnings for the past calendar year are as follows Lisa $34, Khalie $27, Steve $ Josh $ What is Luke's apiaries FUTA tax liability for the year - CORRECT ANSWER $134. First $7000 for each employee x 0. What factor is included in an employee's total compensation report? - CORRECT ANSWER Paid time off such as sick and vacation time Which of the following is not a function of a benefit analysis report? A) it is an analysis of each departments benefit to the company B) it is an analysis of each employees benefit package

C) it is an analysis of the benefits paid to employees D) it is an analysis of the effective labor costs on departmental profitability - CORRECT ANSWER A) it is an analysis of each departments benefit to the company Cronin computers had $987,950 of annual payroll taxes during the Lookback period. The firm pays its employees biweekly on Tuesdays. Assuming that no payday has a tax liability in excess of $100,000. When are the payroll tax deposits due? - CORRECT ANSWER By Friday of the current week The payroll taxes for which an employer must match the entire amount of the employees deduction include _____ - CORRECT ANSWER Social Security and Medicare taxes (up to $142,800 for Social Security tax) Higgins hand weaving, a semi weekly schedule depositor, pays its employees semi monthly on the first and 15th of the month. Per company policy employees are paid their annual bonuses on December 15 the final pay day of the year. On Wednesday, December 15 the bonuses were paid and the payroll tax liability was $165,957. When are the payroll tax deposits due for the bonuses? - CORRECT ANSWER Thursday, December 16 Destany's deliveries had $38,550 of payroll tax liability during their lookback period. They pay their employees on a biweekly basis assuming that no payday has a tax liability in excess of $100,000, When is their payroll tax deposit due? - CORRECT ANSWER By the 15th of the following month Pancakes and waffles Inc. is located in Colorado and has a SUTA tax rate of 4.2% and a wage base of $13,600. During the last calendar year the company paid $584,100 in wages salaries for 11 employees. What is the total of the FUTA and SUTA tax liability for pancakes and waffles Inc. - CORRECT ANSWER $6745. FUTA= first $7000 per employee x 0. SUTA= first $13,600 per employee x 0. Plutonium casting has 30 employees who are distributed as follows Design 4

Fabrication 10 Purchasing 8 Administration 3 Sales 5 The payroll related cost for the year or $560,896. If plutonium, casting, does NOT use departmental classification how much is allocated to each department - CORRECT ANSWER $112,179. $560,896/5 departments What does the term "billable time" mean as it pertains to payroll accounting? - CORRECT ANSWER It is non-employee labor that may be build to customers Which of the following reporting does not involve communication among a company's departments A) employee earnings record B) payroll register C) form 941 D) labor reports - CORRECT ANSWER C) Form 941 Besides payroll information, the employee earnings record contains _____ - CORRECT ANSWER Information about the firms liabilities What is the primary purpose of a labor report? - CORRECT ANSWER It reports where labor is used in a firm Which of the following payroll items is reported on the balance sheet? A) salaries and wages expense B) payroll taxes expense C) health insurance expense D) federal withholding tax payable - CORRECT ANSWER D) federal withholding tax payable

Which of the following best describes the purpose of the employee earnings record A) it is a worksheet that accountants use to ensure payroll accuracy B) it is an individual register maintained for each employee listing all the payroll information C) it is a list of all persons and companies that the company pays money during a period D) it is a report that becomes published with other financial reports - CORRECT ANSWER B) it is an individual register maintained for each employee listing all the payroll information The _____ report assists managers with allocation of labor to company departments - CORRECT ANSWER Labor usage The _____ is the document that contains employees, regular pay, deductions, and pay period disbursements - CORRECT ANSWER Payroll register Which financial report reflects the account of unremitted employer contributions to retirement accounts? - CORRECT ANSWER The balance sheet When journalizing the employees pay accrual the _____ is among the debits and the _____ are among the credits - CORRECT ANSWER Gross pay, payroll tax liabilities The purpose of the _____ is to record all the financial transactions of a firm - CORRECT ANSWER General journal When a payroll accountant transfers information from the general journal to the general ledger the action is called _____ - CORRECT ANSWER Posting The employee earnings record contains _____ - CORRECT ANSWER The employees name, Social Security number, and address Which report contains paid employee wages and salaries for a period? - CORRECT ANSWER The income statement

If a firm accrues the payroll due but not paid at the end of a financial period, What should the payroll accountant due on the first day of the next financial period. - CORRECT ANSWER It should create a reversing entry in the general journal