Chapter 1 - Business Entity
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1.
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Which of the following is a pass through entity for income tax purposes?
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  A sole proprietorship
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A C-Corporation
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A ôDisregarded entityö LLC
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An S-Corporation
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2.
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If you own and work in one of the following entity types are you considered an employee for payroll and payroll tax purposes: a) A partnership; b) A C-Corporation; c) A Sole Proprietorship; d) An S-Corporation; e) An LLC treated as a disregarded entity.
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a and c
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b and d
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e
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All of the above.
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Chapter 2 - Employees and Nonemployees
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3.
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Which of the following are part of the 20 Common Law tests for determining independent contractor status: a) A signed Contract; b) A completed IRS Form W-9; c) The employee is trained by the employer; d) Work is performed on the employer’s premises; e) No tools are needed to do the work.
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4.
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Which of the following are designated as statutory employees, by law?
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Internal Revenue Service Employees.
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Full time Life Insurance Salesmen.
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Direct Sellers.
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Qualified Real Estate Agents.
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Chapter 3 - Earnings
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5.
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In relation to paying employees the term “Exempt” means what?
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The employer does not have to pay that employee.
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The employee doesn't have to have FICA taxes withheld.
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The employer does not have to pay overtime to an employee.
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The employer does not have to give the employee notice of termination.
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6.
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Which of the following is not a basic category for being exempt from overtime?
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Professional
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Outside Sales
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Intellectual
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Highly Compensated Employee
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Administrative
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7.
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The Federal Minimum wage under the FLSA is?
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$2.13 per hour
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$7.25 per hour
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$11.25 per hour
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$15.00 per hour
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8.
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Employers of tipped employees who meet the Department of Labor requirements to use the tip credit provisions of the FLSA must pay tipped employees a minimum of how much per hour?
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9.
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An employer is required to pay for which of the following types of pay when employees don’t work: a) Holiday Pay; b) Bereavement Pay; c) Jury Duty; d) Time off to Vote; e) Birthday Pay.
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a, b and d.
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c and d.
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All of those listed.
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None of those listed.
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Chapter 4 - Deductions
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10.
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Which of the following is a voluntary deduction?
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Child Support Garnishment
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Wage Assignment
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Federal Tax Levy
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United Way Contribution
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11.
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Which of the following earnings are NOT excluded from the disposable earnings calculation for a Child Support Order under Federal Law.
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Income Tax Withholding
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FICA
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Health Insurance Premiums
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Mandated State Employee Retirement Contributions
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12.
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Which of the following deductions may reduce an employee’s net wages below the Federal Minimum Wage?
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Employer provided uniforms that cannot be used for street wear.
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Mandated Tax withholdings
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Interest on loans to Employees
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Penalties for tardiness.
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13.
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Which of the following may NOT be included in a Cafeteria Plan under IRS Code Section 125?
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Group Term Life Insurance
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Adoption Assistance plans.
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Stock Options
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Child Care Expenses
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Chapter 5 - Taxes
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14.
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What are the current (2020) FICA and Medicare Tax rates on employee’s taxable wages below $200,000.00 annually?
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6.20% and 1.45%
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15.3% and 2.9%
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6.20% and 2.9%
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7.65% and 1.45%
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15.
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The lookback period to determine whether an employer is a monthly or semi-weekly depositor for the current calendar year is?
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January 1 through Dec 31 Last Year
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The last three quarters
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July 1 through June 30 of the previous two years.
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Based on a calculation from the IRS website.
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16.
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Which of the following are NOT Legal Holidays that delay employment tax deposits an additional business day?
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Birthday of Martin Luther King Jr.
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Memorial Day
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Mother's Day
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Veterans Day
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17.
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In fixing a mistake on an IRS Form 941 Employer’s QUARTERLY Federal Tax Return, what do you use to make that correction?
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A letter to the IRS.
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IRS Form 942 QUARTERLY Federal Tax Return Correction.
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EFTPS
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IRS Form 941X Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund.
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18.
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FUTA taxes are reported on what Government Form?
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IRS Form 2848
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SSA Form 2121
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IRS Form 940
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Treasury Form UTxx (xx for two digit year)
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19.
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What year end forms are filed with the Social Security Administration showing the worker’s income and tax withholdings and a summary of them?
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W2 & 1099
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1099 & 1096
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W2 and W3
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W3 & 1099
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Chapter 6 - Tax Penalties
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20.
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Which of the following is not one of the four normal penalties the IRS levies of employers concerning employment tax problems?
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Failure to file or file timely.
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Filing with the wrong IRS service center.
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Underreporting Taxes
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Depositing taxes late.
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21.
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Which of the following pay periods does the author recommend for a good balance between cost and convenience for employers to use?
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Weekly
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Biweekly
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Semi-monthly
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Monthly
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Quarterly
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Chapter 7 - Workweek, Pay Period, Payday
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22.
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When must Payday be for employees?
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The last day of the pay period.
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Seven days after the pay period ends.
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Anytime within the period of time the State sets.
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As required by FLSA.
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Chapter 8 - The Law
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23.
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FLSA is the acronym for?
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Federal Labor Service Act
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Financial Legal Services Accounting
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Fair Labor Standards Act
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Final Labor Services Accountability
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24.
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Which of the following is NOT regulated by FLSA?
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What breaks and lunch periods must be paid.
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Labor hour restrictions on young adults 16 and 17 years of age.
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Labor related record keeping by employers
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Payday timing for employees
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25.
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Which of the following employers is NOT automatically covered by FLSA?
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The local Catholic Hospital.
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The local Community College
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The summer Ice Cone Stand with two part time employees
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The local Domino's company owned pizza outlet.
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26.
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Which of the following jobs are prohibited to youth under the age of 18 under the FLSA Child Labor Provisions.
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Certified Nursing Assistant
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Driving a Motor Vehicle
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Brick Layer
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Farm Worker
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27.
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Which of the following is NOT a qualifying reason for FMLA leave?
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Birth of an employee's child.
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A Doctor's appointment
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A serious Health Condition which makes an employee unable to perform their job.
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To care for a service member who is the employee's spouse, child, parent or next of kin.
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28.
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What is the maximum amount of tax credit, as a percentage of wages, available to an employer under Section 45S, for qualifying employee paid time off?
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29.
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Some States currently classify Independent Contractors as employees for reporting purposes under the Personal Responsibility and Work Opportunity Reconciliation ACT of 1996 so as to notify employees of existing child support orders?
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30.
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To make a claim under the Equal Pay Act you must show that you, and an employee of the opposite sex, are all of the following EXCEPT?
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Working in the same place.
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Are the same age.
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Doing equal work.
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Receive unequal pay.
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Chapter 9 - Collecting Time
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31.
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What type of time clock eliminates buddy punching?
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Electronic
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Biometric
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Web Based
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Mobile Phone based
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Chapter 10 - Calculating Payroll
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32.
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If an employee works different jobs for a single employer during a pay period, that pay at different wage rates, overtime premium is calculated by using?
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Chinese Overtime calculations.
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Last Rate calculation.
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Mean Rate calculation.
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Blended Overtime calculation.
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33.
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Medicare withholding taxes on an annual salary of $100,000 per year amount to how much on an annual basis?
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$1,450.00
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$2,900.00
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$6,200.00
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$7,650.00
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34.
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How many jurisdictions (approximately) impose local or municipal taxes that have to be withheld from an employee’s payroll?
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1,000
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5,000
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100,000
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1,245,500
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Chapter 11 - Paying Your Employee
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35.
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The benefits of paying employees via Direct Deposit does NOT include which of the following benefits?
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Cost savings to the employer.
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Confidentiality for employee.
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Immediate access after processing.
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Convenience for employer and employee.
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Chapter 12 - Taxes Depositing and Filing
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36.
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At the end of the payroll year which of the following is NOT created and filed?
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Form 940 Federal Unemployment tax report.
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W2s for all employees.
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1099s for all independent contractors paid in excess of $600.00.
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Form I9 with the Department of Homeland Security.
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Chapter 13 - Record Keeping
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37.
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According to the Immigration Reform and Control Act you must keep copies of completed Form I-9 for how long?
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90 days after hire date.
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One year after termination.
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Three years after hire date.
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Seven years after termination.
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38.
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Why should you keep health Insurance enrollment or decline forms?
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Required by FLSA
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Required by State Department of Insurance
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To prevent lawsuits.
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HHSA requirements.
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39.
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“The Payroll Book” author recommends that you keep all payroll records for at least what period of time?
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One year after employee termination.
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Three years.
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At least seven years.
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Forever
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Chapter 14 - Workers' Compensation Insurance
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40.
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Worker’s Compensation Insurance covers what risks?
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Employee on the job accidents.
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All employee accidents.
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Employee medical expenses no matter what the cause.
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All accident related medical expenses in a work site.
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41.
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Which of the following is NOT part of calculating Worker’s Compensation Insurance premiums?
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Class Codes.
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Determination Codes.
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Number of employees.
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Claims history.
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42.
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Which of the following is included when calculating the payroll amount for the Worker’s Compensation Premium?
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Tips.
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Overtime.
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Severance pay.
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Payments to employees on active duty.
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43.
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An advantage of using a “Pay as You Go” program for Worker’s Compensation Insurance is?
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Smaller up front deposit
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No audit adjustments.
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Interest earned deposited premiums
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Lower premiums
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Chapter 15 - Payroll Security and Internal Controls
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44.
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When will a procedure manual need to change?
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When a new company President takes over.
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When the shop steward changes
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When the law changes.
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The first of the year.
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45.
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What are ghost employees?
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Third shift employees that you never see.
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Offsite employees
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People who the employer pays but don't work.
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Offsite security employees that monitor surveillance cameras.
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46.
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What is Positive Pay?
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A smiley face on each paycheck and direct deposit voucher.
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Making sure there is a positive balance in the payroll account before issuing checks.
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The bank verifying the information of every check presented for clearance.
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Making sure every issued check is cashed.
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Chapter 16 - US Citizens Abroad, Resident and Nonresident Aliens, and Illegal Aliens
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47.
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What does an ITIN do for an alien?
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Entitles them to a Social Security Number.
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Confers legal immigrant status.
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Allows their tax returns to be processed.
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Gives them the right to work in the United States.
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48.
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What is Escheat in relation to payroll?
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A method of check fraud rampant in the Northeast.
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A requirement to submit uncashed payroll check amounts to the State.
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Notice that a direct deposit account for an employee is not valid.
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The variation between time clock time and the National Clock Time.
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49.
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An employer becomes subject to the Fair Labor Standards Act once they have how many employees?
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One
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Twenty Five
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Fifty
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One Hundred
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50.
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Which of the following should an Employee Handbook/Policy Manual layout for new employees: a) Introduce new hires to company values and standards; b) Set out policies for sick pay, vacation, timekeeping and more; c) Explain standards of conduct; d) Detail benefits; e) Establish grounds for termination.
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a and b
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c
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c and d
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All of the above,
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Chapter 17 - Other Issues
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