Payroll MCQ Questions Answers

1. Who typically maintains employee wage rates in the payroll system?

2. Why would a company require a supervisor to approve an employee's hours?

3. What is an NSF check?

4. Which of the following statements about independent contractors is true?

5. Employee C wants to contribute $8,000 a year to his tax shelter annuity. The district allows payroll deductions for tax shelter annuities to be spread over 18 pay periods. How much will have to be deducted each pay period so that Employee C contributes the $8,000?

6. The term "earned income credit" refers to ______________.

7. For an employer, which of the following is a benefit of using direct deposit?

8. A company that employs ______________ is subject to the Civil Rights Act of 1964.

9. Why has the IRS allowed employers to combine federal taxes when computing withholding amounts?

10. Which of the following should happen in the payroll system after an employee is terminated?

11. The term "internal control" refers to ______________.

12. What is the purpose of Form 941?

13.

Employee B has an annual salary of $50,000 that is paid to him over 26 pay periods. He works 260 days per year. He retires after working 65 days, during which time he received 6 paychecks.

Given this information, Employee B's gross wages for his final paycheck will be _____________.

14. What is the purpose of accruing vacation expense?

15. The term "the accounting process" refers to ______________.

16. On which of the following financial statements is Revenue reported?

17. "Regular earnings" are considered earnings for how many hours of work?

18. The term "workers compensation insurance" refers to ______________.

19. Of the following, which is the best safeguard against employees accessing the payroll system?

20. The term "audit trail" refers to ______________.

21. The term "profit sharing" refers to ______________.

22. A W4 is ____________.

23. The term "oppressive child labor" refers to ____________.

24. The term "disability insurance" refers to ______________.

25. Which of the following is an example of an internal control for payroll?

26. The term "commission plan" refers to ______________.

27. The term "employee earnings record" refers to ______________.

28. Which of the following illustrates the basic Balance Sheet formula?

29. Which of the following is a disadvantage of an automated payroll system?

30. How are FUTA taxes recorded at the time of payroll?

31. The Equal Pay Act ____________________.

32. Are meals provided on the company's premises subject to employment taxes as a benefit?

33. Who controls the regulations for the timing of payment of wages?

34. Who issues an EIN to a company?

35. The term "bona fide occupational qualification" refers to _______________.

36. The term "contribution report" refers to ______________.

37. The term "percentage method of withholding" refers to ______________.

38. What does the acronym SUTA stand for?

39. The term "piece rate plan" refers to ______________.

40. Which of the following payroll items is worth auditing?

41. Who decides if a person is an employee or an independent contractor?

42. How often should payroll be reconciled?

43. What is the purpose of an EIN?

44. According to the Self-Employment Contributions Act, any enterprise ___________________ is considered a business.

45. Which of the following is a benefit of an automated payroll system?

46. What is the purpose of Form W2?

47. The term "self-employment income" refers to ______________.

48. The term "unemployment compensation benefits" refers to ______________.

49. The term "bonus" refers to ______________.

50. The term "payroll register" refers to ______________.

51. The Circular E: Employer's Tax Guide is ______________.

52. The term "taxable wages" refers to ______________.

53. Which of the following factors might prompt a company to switch to an automated payroll system?

54. The term "overtime" refers to ______________.

55. Which of the following accounts is debited when FUTA taxes are paid to the government?

56. Which of the following age groups is covered by the Age Discrimination in Employment Act of 1967?

57.

At ABC School, the current salary schedule for custodians is as follows:

Step 1:   $12.47

Step 2:    $13.09

Step 3:    $13.75

Step 4:    $14.44

Step 5:    $15.16

Employees are moved to the next step on the salary schedule annually. Wages for the year have increased 2.25% from the previous school year. Employee C was paid on Step 2 for the previous school year.

Given the above schedule, what is Employee C's pay rate for the current school year?

58. The term "direct deposit" refers to ______________.

59. What is the purpose of auditing payroll ?

60. Payroll system software can be hosted _____________.

61. The term "wage bracket method for withholding taxes" refers to ______________.

62. For an employer, which of the following is a disadvantage of using direct deposit?

63. For an employee, which of the following is a benefit of using direct deposit?

64. The term "withholding allowance" refers to ______________.

65. What is the purpose of Form 940?

66. What is the purpose of a time card?

67. What is an EIN?

68. On which of the following financial statements is Payroll Expense reported?

69. The term "payroll period" refers to ____________.

70. The term "statutory employee" refers to ______________.

71. A company must file Form W3 every year by _____________.

72. The term "cumulative method of withholding" refers to ______________.

73. The term "incentive payment plan" refers to _______________.

74. Which of the following is a major payroll processor?

75. The Fair Labor Standards Act of 1938 __________________.

76. What is Form W3?

77. Which of the following journal entries would be made to void a payroll check printed in error?

78. The term "escheat law" refers to ____________.

79. The term "guaranteed wage" refers to ______________.

80. A company must send W2 forms every year to its employees by _____________.

81. If an employer

82. What is the current 2012 FICA SS rate for employees?

83. Where do you look to find payroll withholding deductions based on employee elected filing status?

84. Where is a student's EIN generally registered?

85. What is the current maximum SS taxable wage amount for 2012?

86. If an employee's gross wages are $10,000, federal withholding is $1,000 and the employee wages YTD is $112,000, how much more tax money should be taken from employee's check?

87. A non-exempt employee works 38 hours one week and 46 hours the next week. How many hours should this employee be paid for two weeks if guaranteed 40 hours?

88. A non-exempt employee worked 48 hours one week which included a holiday and 46 hours the next week. How much OT pay is due to this employee?

89. How long should a W-4 be kept on file?

90. How long should an employer retain payroll information?

91. What is the current employer tax rate for FICA social security and medicare?

92. Which form is needed for independent contractors or vendors who are seeking payment for their products/services?

93. Which form is used to correct an employees reported wages to IRS after W-2's have been issued?

94. Which tax return is used to file federal annual employer paid taxes?

95. What form must a contractor include to not be considered an employee?

96. Which tax can you elect to be paid for in advance in your check if you qualify?

97. A employee garnishment is usually taken out of an employee's check when?

98. What two accounting records are payroll typically recorded to?

99. What type of tax return is used to file employee deducted and employer matched payroll taxes at the end of a quarter?

100. When accounting for taxes payable, how are they listed?