Question 1

According to Consumer Credit Protection Act, what is a limit on the amount of a garnishment for consumer credit?

Accepted Answer

A)  It must be less than 50% of an employee's gross earnings. 
B)  It may be 75% of the employee's disposable income. 
C)  It must be a minimum of 10% of an employee's annual salary. 
D)  It cannot exceed 25% of an employee's disposable income. 
A)  It must be less than 50% of an employee's gross earnings. 
B)  It may be 75% of the employee's disposable income. 
C)  It must be a minimum of 10% of an employee's annual salary. 
D)  It cannot exceed 25% of an employee's disposable income.

Question 2

Publication ________ is the employer's guide to fringe benefits.

Accepted Answer

A)  10-a 
B)  15-f 
C)  15-b 
D)  12-c 
A)  10-a 
B)  15-f 
C)  15-b 
D)  12-c

Question 3

What options do employers have regarding taxable fringe benefits? (Select all that apply.)

Accepted Answer

A)  Add it to the employee's W-2 in one lump sum. 
B)  Add it to a single pay period and tax it at the 25% income tax rate. 
C)  Add the value of the fringe benefit to period pay and tax it at that time. 
D)  Add it as a line item for employees to remit individually. 
A)  Add it to the employee's W-2 in one lump sum. 
B)  Add it to a single pay period and tax it at the 25% income tax rate. 
C)  Add the value of the fringe benefit to period pay and tax it at that time. 
D)  Add it as a line item for employees to remit individually.

Question 4

________ is the price that a person would pay for an item in an arm's length transaction.

Accepted Answer

A)  General valuation 
B)  Manufacturer's Suggested Retail Price 
C)  De Minimis 
D)  Fair Market Value 
A)  General valuation 
B)  Manufacturer's Suggested Retail Price 
C)  De Minimis 
D)  Fair Market Value

Question 5

Which of the following is true about the employee tax treatment of employer-provided snacks and meals?

Accepted Answer

A)  Occasionally provided snacks and meals are not taxable. 
B)  Snacks and meals provided on a regular basis are not taxable. 
C)  Holiday parties and meals provided at special gatherings are always taxable. 
D)  All employer-provided snacks and meals are taxable. 
A)  Occasionally provided snacks and meals are not taxable. 
B)  Snacks and meals provided on a regular basis are not taxable. 
C)  Holiday parties and meals provided at special gatherings are always taxable. 
D)  All employer-provided snacks and meals are taxable.

Question 6

The most common way to determine the value of fringe benefits is the general valuation rule.

Accepted Answer

A) True 
 B)False

Question 7

Employers benefit by offering POPs because they reduce ________.

Accepted Answer

A)  income tax liability 
B)  cash paid to employees 
C)  FICA tax liability 
D)  employee turnover 
A)  income tax liability 
B)  cash paid to employees 
C)  FICA tax liability 
D)  employee turnover

Question 8

Which of the following is an includible medical expense, according to Publication 502? (Select all that apply.)

Accepted Answer

A)  Ambulance service 
B)  Over-the-counter medicines 
C)  Hearing aids 
D)  Braille books and magazines 
A)  Ambulance service 
B)  Over-the-counter medicines 
C)  Hearing aids 
D)  Braille books and magazines

Question 9

Which of the following deductions may be taken on a pre-tax basis? (Select all that apply.)

Accepted Answer

A)  Cafeteria plan 
B)  Garnishments 
C)  Health insurance 
D)  Retirement plan 
A)  Cafeteria plan 
B)  Garnishments 
C)  Health insurance 
D)  Retirement plan

Question 10

What method(s) may be used to determine the fair market value of the personal use of a company car? (Select all that apply.)

Accepted Answer

A)  Appraised value rule 
B)  Commuting rule 
C)  Cents-per-mile rule 
D)  Replacement value rule 
A)  Appraised value rule 
B)  Commuting rule 
C)  Cents-per-mile rule 
D)  Replacement value rule

Question 11

As a general rule, when should the employer deposit money associated with employee benefits?

Accepted Answer

A)  When the employee demands the benefit. 
B)  When the benefit is made available. 
C)  Immediately upon receipt. 
D)  When other tax deposits are made. 
A)  When the employee demands the benefit. 
B)  When the benefit is made available. 
C)  Immediately upon receipt. 
D)  When other tax deposits are made.

Question 12

The cash value of ________ must be included as compensation on the employee's W-2.

Accepted Answer

A)  occasional meals and snacks 
B)  gift cards 
C)  on-site athletic facilities 
D)  plaques and trophies 
A)  occasional meals and snacks 
B)  gift cards 
C)  on-site athletic facilities 
D)  plaques and trophies

Question 13

Specific fringe benefit exclusion rules are found in Publication 15.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is true about 401(k) retirement plans?

Accepted Answer

A)  All 401(k) plans are cafeteria plans. 
B)  401(k) plans are exempt from all payroll taxes. 
C)  401(k) plans always reduce income tax liability. 
D)  401(k) plans are usually subject to FICA taxes. 
A)  All 401(k) plans are cafeteria plans. 
B)  401(k) plans are exempt from all payroll taxes. 
C)  401(k) plans always reduce income tax liability. 
D)  401(k) plans are usually subject to FICA taxes.

Question 15

Frances McNale is an employee who drives a 2017 Ford C-Max with a fair-market value of $29,500. The lease value is $7,750, according to Publication 15-b. The car was available for 150 days during the year, and she reported that 6,500 of the 27,850 miles were driven for personal purposes. The company pays for all fuel and is charged back to Frances at $0.055 per mile. What is the amount of the company-car fringe benefit that will appear on Frances's W-2, using the lease-value rule? (Do not round intermediate calculations, only round final answer to two decimal points.)

Accepted Answer

A)  $1,100.84 
B)  $1,020.44 
C)  $743.34 
D)  $964.24 
A)  $1,100.84 
B)  $1,020.44 
C)  $743.34 
D)  $964.24

According to Consumer Credit Protection Act, what is a limit on the amount of a garnishment for consumer credit?

Publication ________ is the employer's guide to fringe benefits.

What options do employers have regarding taxable fringe benefits? (Select all that apply.)

________ is the price that a person would pay for an item in an arm's length transaction.

Which of the following is true about the employee tax treatment of employer-provided snacks and meals?

The most common way to determine the value of fringe benefits is the general valuation rule.

Employers benefit by offering POPs because they reduce ________.

Which of the following is an includible medical expense, according to Publication 502? (Select all that apply.)

Which of the following deductions may be taken on a pre-tax basis? (Select all that apply.)

What method(s) may be used to determine the fair market value of the personal use of a company car? (Select all that apply.)

As a general rule, when should the employer deposit money associated with employee benefits?

The cash value of ________ must be included as compensation on the employee's W-2.

Specific fringe benefit exclusion rules are found in Publication 15.

Which of the following is true about 401(k) retirement plans?

Payroll Practices and System Fundamentals

Payroll System Procedures

Gross Pay Computation

Employee Net Pay and Pay Methods

Employer Payroll Taxes and Labor Planning

The Payroll Register, Employees Earnings Records, and Accounting System Entries

Filters

Exam 4: Fringe Benefits and Voluntary Deductions

According to Consumer Credit Protection Act, what is a limit on the amount of a garnishment for consumer credit?

Publication ________ is the employer's guide to fringe benefits.

What options do employers have regarding taxable fringe benefits? (Select all that apply.)

________ is the price that a person would pay for an item in an arm's length transaction.

Which of the following is true about the employee tax treatment of employer-provided snacks and meals?

The most common way to determine the value of fringe benefits is the general valuation rule.

Employers benefit by offering POPs because they reduce ________.

Which of the following is an includible medical expense, according to Publication 502? (Select all that apply.)

Which of the following deductions may be taken on a pre-tax basis? (Select all that apply.)

What method(s) may be used to determine the fair market value of the personal use of a company car? (Select all that apply.)

As a general rule, when should the employer deposit money associated with employee benefits?

The cash value of ________ must be included as compensation on the employee's W-2.

Specific fringe benefit exclusion rules are found in Publication 15.

Which of the following is true about 401(k) retirement plans?

Payroll Practices and System Fundamentals

Payroll System Procedures

Gross Pay Computation

Employee Net Pay and Pay Methods

Employer Payroll Taxes and Labor Planning

The Payroll Register, Employees Earnings Records, and Accounting System Entries

Filters