ACCT 218 Payroll Ch 1-3 Study Guide: Comprehensive Questions and Answers, Exams of Accounting

Download ACCT 218 Payroll Ch 1-3 Study Guide: Comprehensive Questions and Answers and more Exams Accounting in PDF only on Docsity!

ACCT 218 Payroll Ch 1-3 Study guide | Comprehensive Questions and Answers Latest

Updated 2024/2025 With 100% Verified Solutions

Which act sets the minimum wage, and what is the current wage rate? a). The Civil Rights Act of 1964 sets the minimum wage and the current minimum wage rate is $7.50 per hour. b.)The Federal Unemployment Tax Act sets the minimum wage and the current minimum wage rate is $7.25 per hour. c). The Self-Employment Contributions Act sets the minimum wage and the current minimum wage rate is $9.19 per hour. d. The Fair Labor Standards Act sets the minimum wage and the current minimum wage rate is $7.25 per hour. e. None of these choices are correct. - ✔✔d. The Fair Labor Standards Act sets the minimum wage and the current minimum wage rate is $7.25 per hour. Under the FLSA, what information concerning employees' wages earned must be maintained by the employer? a). the amount and nature of exempt pay b). the payroll period c) the total additions to or deduction from wages d). all of these choices are correct - ✔✔d). all of these choices are correct Who pays the social security taxes that are levied by the Federal Insurance Contributions Act? a). the employee b). the employer c). both employee & employer d). only a self-employed individual - ✔✔d). both employee & employer How are the funds used which are provided by FUTA and SUTA? a. All of the funds are used to provide the benefits of unemployment compensation to qualified unemployed workers.

b. FUTA funds are used to pay the state and federal administrative expenses and SUTA funds are used to pay the unemployment compensation benefits to the qualified unemployed workers. c. SUTA funds are used to pay the state and federal administrative expenses and FUTA funds are used to pay the unemployment compensation benefits to the qualified unemployed workers. d. none of these choices are correct - ✔✔b. FUTA funds are used to pay the state and federal administrative expenses and SUTA funds are used to pay the unemployment compensation benefits to the qualified unemployed workers. Which of the following acts prohibits discriminating in hiring, firing, promoting, compensating, or in any other condition of employment on the basis of race, color, religion, sex, or national origin? a). The federal Personal Responsibility and Work Opportunity Reconciliation Act of 1996 b). the Federal Unemployment Tax Act (FUTA) c). The Civil Rights Act of 1964 d). None of these choices are correct - ✔✔c). The Civil Rights Act of 1964 What is the purpose of the Age Discrimination in Employment Act (ADEA)? A). To provide protection only for workers under the age of 18 B). To prohibit discrimination on the basis of age in the employment practices of employer C). Both of these choices are correct D). Neither of these choices is correct - ✔✔ Which of these employee types is an allowable exception to the protection of the Age Discrimination in Employment Act (ADEA)? a. Executive employees who are 65 years or older and have held high policymaking positions during the two-year period prior to retirement b. Employees who earn more than $44,000 per year c. Employees over the age of 40 who have held high policymaking positions during the two-year period prior to retirement d. None of these choices are correct. - ✔✔a. Executive employees who are 65 years or older and have held high policymaking positions during the two-year period prior to retirement Who is covered by the Walsh-Healey Public Contracts Act?

a. Employees who work for vendors who provide legal services to any agency of the United States, provided the minimum contract amount is $15, b. Laborers for contractors who furnish materials, supplies, articles, and equipment to any agency of the United States, provided the minimum contract amount is $15, c. Laborers for contractors who furnish materials, supplies, articles, and equipment to any agency of the United States, provided the minimum contract amount is $2, d. All employees of companies with federal agency contracts - ✔✔b. Laborers for contractors who furnish materials, supplies, articles, and equipment to any agency of the United States, provided the minimum contract amount is $15, Under the Family and Medical Leave Act, what is the maximum number of weeks of unpaid leave that a covered employer is required to offer an employee whose spouse is seriously ill? a). 25 b). 11 c). 12 d). 10 - ✔✔c). 12 What is the primary purpose of the Employee Retirement Income Security Act (ERISA)? a. ERISA ensures that workers covered by private pension plans receive benefits from those plans in accordance with their credited years of service with their employers. b. ERISA ensures that workers covered by state and federal government pension plans receive benefits from those plans in accordance with their credited years of service with their employers. c. ERISA requires that all companies offer private pension plans. d. None of these choices are correct. - ✔✔a. ERISA ensures that workers covered by private pension plans receive benefits from those plans in accordance with their credited years of service with their employers. At a minimum, how often should an administrator furnish a statement of total benefits accrued and accrued benefits that are vested under ERISA? a). Once in 9 month period b). Every month c). Once in 6 month period

d). Once in 12 month period - ✔✔d). Once in 12 month period What is vesting? a. Vesting conveys to employees the right to share in the retirement fund when the employee has reached 30 years of service. b. Vesting conveys to employees the right to share in the retirement fund when the employee has reached 62 years of age. c. Vesting conveys to employees the right to share in the retirement fund in the event they are terminated before the normal retirement age. d). All of these choices are correct - ✔✔c. Vesting conveys to employees the right to share in the retirement fund in the event they are terminated before the normal retirement age. Under the Affordable Care Act, which employers are required to provide insurance coverage for all full- time employees and their dependents? a). Fewer than 50 full-time employees with average wages of less than $100, b). all applicable large employers - ALEs c). Both of these choices are correct d). None of these choices are correct - ✔✔b). all applicable large employers - ALEs Which of the following steps should be taken by the Human Resources Department when hiring new employees? a. References should be checked b. Personnel files should be prepared c. Tests may be administered d. All of these choices are correct. - ✔✔d. All of these choices are correct. What information is commonly provided by a job-seeker on the application for employment form? a. Employment and experience history b. References c. Educational background, including a summary of the schools attended, whether the applicant graduated, and degrees conferred

d. All of these choices are correct. - ✔✔d. All of these choices are correct. Under the Civil Rights Act of 1964 and the Age Discrimination in Employment Act, which of the following questions may not be asked by an employer during pre-hire inquiries? a). what is you religion? b). What is your race? c). what is your sex? d). all of these choices are correct. - ✔✔d). all of these choices are correct. What obligations are imposed upon the employer by the Fair Credit Reporting Act of 1968? a. They must seek an investigative report on all prospective employees. b. They must disclose to the job applicant that they are seeking an investigative report. c. If employment is denied because of the facts on the investigative report, the employer does not have to inform the applicant. d. None of these choices are correct. - ✔✔b. They must disclose to the job applicant that they are seeking an investigative report. Which of the following are processes that occur in most payroll accounting systems? a. Recording hours worked or units produced b. Preparation of payroll reports c. Computation of gross pay, deductions, and net pay d. All of these choices are correct. - ✔✔d. All of these choices are correct. Which basic records are generated in most payroll accounting systems? a. A payroll register b. The employee's safety awards record c. The employee's earnings record d. Only "A payroll register" and "The employee's earnings record" are correct. - ✔✔d. Only "A payroll register" and "The employee's earnings record" are correct.

How can the information shown in the employees' earnings record be used? a. To complete Form W-2 for employer b. To prepare period reports c. To complete Form W-2 for each employee d. To prepare period reports and complete Form W-2 for each employee e. To prepare period reports and complete Form W-2 for employer - ✔✔d. To prepare period reports and complete Form W-2 for each employee The two bases of coverage provided by the FLSA are: A). enterprise coverage and individual employee coverage B). enterprise coverage and employer coverage C). individual employee coverage and departmental coverage D). individual employee coverage and employer coverage - ✔✔A). enterprise coverage and individual employee coverage The U.S Department of Labor utilizes which of the following tests in determining the existence of an employer-employee relationship? A). amount of skill, initiative, judgement, or foresight required for the worker's services B). Permanency of the worker's relationship with the employer C). Nature and degree of the employer's control D). Degree of integration of the worker's services into the employer's business E). All of these choices are correct - ✔✔E). All of these choices are correct Which of the following establishments may employ full-time students at 85% of the minimum wage? A). Retail or service establishments B). Farms C). Institutions of higher education D). All of these choices are correct - ✔✔D). All of these choices are correct What is Miami's living wage rate for contracts entered into on or after October 1, 2016?

In Miami, Florida the living wage rate for city employees or those who work for companies with city contracts that exceed $100,000, if employer provides health insurance is ___________ per hour. The wage rate if employer does not provide health insurance is __________ per hour. - ✔✔$15. $18. Per the FLSA, a tipped employee is one who receives ___ or more per month in tips. An employer can credit up to ___ of a tipped employee's minimum wage as coming from tips actually received. - ✔✔$30. $5. State employees working in the area of public safety may accumulate compensatory time off up to _______ hours. - ✔✔ 480 A state employee may be paid for compensatory time off in which of the following cases? A). Upon reaching the "bank" maximum of 480 or 240 hours B). At termination of employment C). Both "At termination of employment" and "upon reaching the "bank" maximum of 480 or 240 hours" D). None of these choices are correct - ✔✔C). Both "At termination of employment" and "upon reaching the "bank" maximum of 480 or 240 hours" The following employees are exempt from which of the requirements of the FLSA: a). Amusement park employees are exempt from b). Taxicab drivers are exempt from c). Casual babysitters are exempt from d). Elementary school teachers are exempt from e). Outside salespersons are exempt from - ✔✔a). minimum wage, equal pay, and overtime provisions b). only the overtime provision c). minimum wage, equal pay, and overtime provisions d). the minimum wage and overtime provisions e). the minimum wage and overtime provisions

The types of exempt white-collar employees are: A). executives, administrators, professionals, highly compensated employees, computer professionals, creative professionals, and outside salespersons. B). elementary school teachers, administrators, professionals, taxicab drivers, computer professionals, creative professionals, and outside salespersons. C). executives, administrators, amusement park employees, highly compensated employees, computer professionals, creative professionals, and outside salespersons. D). executives, administrators, professionals, highly compensated employees, casual baby sitters, creative professionals, and outside salespersons. - ✔✔A). a. executives, administrators, professionals, highly compensated employees, computer professionals, creative professionals, and outside salespersons. To be classified as a "highly compensated employee", they must: A). earn $107,432 or more B). perform nonmanual work C). regularly perform one of the exempt duties of an executive, administrator, or professional employee D). All of these choices are correct - ✔✔D). All of these choices are correct In order not to interfere with the schooling and well-being of minors between the ages of 14 and 16, employers of these minors must satisfy which of these conditions? A). There is a maximum 3-hour day and 18-hour week when school is in session (8 hours and 40 hours, respectively, when not in session). B). All work must be performed outside school hours C). Work must be performed between 7 A.M and 7 P.M (9 P.M in summer) D). All of these choices are correct - ✔✔D). All of these choices are correct In determining the working time of employees, the principal activities of employees include: A). those that are indispensable to the performance of productive work B). those that are an integral part of a principal activity C). those they must perform, including any work of consequence performed for the employer D). All of these choices are correct - ✔✔D). All of these choices are correct

If an employee must travel a substantial distance from their usual work location to perform work, the travel to and from that site counts as _________. - ✔✔time worked "Engaged to wait" is considered as __________ and "Waiting to be engaged" is considered as ___________. - ✔✔working time non-working time In order to get caught up, a nonexempt employee takes work home. The employee _______ for this extra time. - ✔✔must be paid Time spent by employees in attending lectures or training sessions does not count as working time under which condition? A). the meeting or lecture is not directly related to the employee's work B). The meeting or lecture takes place outside regular working hours C). the employee does not produce any goods or perform any other productive work during the meeting or lecture D). Attendance by the employee is voluntary E). All of these choices are correct - ✔✔E). All of these choices are correct Preliminary and postliminary activities are compensated if one of the conditions is met: A). It is customary in the industry B). It is an integral and indispensable part of the employee's principal activity C). There is a prior agreement between the employer and employee D). All of these choices are correct - ✔✔D). All of these choices are correct A(n) ________ time clock identifies an employee's unique fingerprint, handprint, voice, iris, or whole face. - ✔✔biometric The Wage and Hour Division allows employers to round off employees' work time to the nearest _______- minutes. - ✔✔5,6, or 15

If the overtime premium approach is used, overtime premium pay is calculated by ___________ the overtime hours by an overtime premium rate of one-half of the regular hourly rate. - ✔✔multiplying To calculate the overtime hourly rate for employees who are paid biweekly, ________ by 2 to arrive at the weekly salary, then ________ the weekly salary by the regular number of hours worked to obtain the hourly rate. _____________ this rate by one and one-half to obtain the overtime rate - ✔✔Divide divide multiply Nondiscretionary bonuses include - ✔✔Amounts set up as inducements to achieve goals Commissions are considered to be payment for hours worked _______ included in determining the regular hourly rate. - ✔✔and must be For a salaried employee working a fluctuating schedule who is paid on a fixed salary, overtime pay is found by ______ the normal salary by the total hours worked and then _________ that number in half to get the extra half-rate. - ✔✔dividing dividing The regular rate of pay for a salaried nonexempt employee is found by _________ the number of hours expected to be worked each week into the weekly salary. - ✔✔dividing For social security purposes, what conditions must an individual meet to be classified as a "covered" employer? A). the common-law relationship of employer and employee must exist B). The person must employ one or more individuals for the performance of services in the United States. C). Both of these answers are correct D). Neither of these answers are correct - ✔✔B). The person must employ one or more individuals for the performance of services in the United States.

In order to be classified as a "covered" employee, an individual must perform services where - ✔✔the common-law relationship of employer and employee exists A ________relationship exists between an employee and an employer when the employer tells or has a right to tell a worker how, when, and where to work. - ✔✔common-law An _______________ is a person who follows an independent trade, business, or profession and offers services to the public. - ✔✔independent contractor Employers must collect ______________ taxes on tips reported by employees and for wages paid to tipped employees. Employers are also liable for their share of the __________ taxes on the tips reported by employees and for wages paid to tipped employees. - ✔✔FICA FICA The first ________ months of sick pay received by an employee is considered to be wages. These amounts are subject to withholding for FICA tax purposes. - ✔✔six Employees' pretax contributions into a qualified deferred compensation plan are subject to __________ tax. However, the employers' matching contributions are ________ - ✔✔FICA tax-free John Luis receives wages from three employers during 20--. Is he entitled to a refund on the OASDI taxes paid on wages in excess of the taxable wage base? If individuals paid OASDI taxes on wages in excess of $160,200 ______________________, they are entitled to a ________________. If so, how can he receive a refund? - ✔✔because of having worked for more than one employer refund of their overpayment it is credited against the taxpayer's federal income taxes for that year. The self-employment tax rates for 2023 on net earnings are _______% for OASDI and ____________ % for HI. Self-employment income is subject to _________ % additional HI tax on earned income in excess

of $___________. The actual tax calculation is done on Schedule SE (Self-Employment Tax) of Form

1040. • ✔✔12.

$200, The deposit rules for nonagricultural employers are: a. Total taxes $50,000 or less in the lookback period: b. Total taxes more than $50,000 in the lookback period: c. Accumulated taxes of $100,000 or more: d. If you fell under the one-day rule at any time during this year or last year: e. Less than $2,500 for the quarter: - ✔✔a). Deposit taxes monthly b). Deposit taxes semiweekly c). Deposit by the next banking day d). Deposit taxes semiweekly e). Deposit by the end of the month following the quarter, or mail taxes with Form 941 All employers must deposit their employment taxes electronically with the exception of those with _________ or less in quarterly tax liabilities - ✔✔$2, There are two electronic methods of deposit. When the employer instructs the Treasury Financial Agent to withdraw funds from the employer's account and route them to the Treasury's account at the Federal Reserve Bank it is referred as

---

When the employer instructs the bank to send the payment directly to the Treasury's account at the Federal Reserve Bank it is referred as_________________ - ✔✔ACH debit method ACH credit method Generally, an employer must file Form 941 each calendar - ✔✔quarter

Penalties that may be imposed in the following cases: A). One month late in filing Form 941: B). Seven days late in making a tax deposit: C). Issuing a bad check to the IRS: - ✔✔A). 5% of the net amount of tax B). 5% of the undeposited taxes C). 2% of the amount of the taxes