Question 1

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

Accepted Answer

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

Question 2

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

Question 3

According to the Affordable Health Care Act, employers with ________ or more employees are required to ﬁle an informational return with the IRS and a detailed summary to the employees.

Accepted Answer

A)  150 
B)  100 
C)  10 
D)  50 
A)  150 
B)  100 
C)  10 
D)  50 D

Question 4

Which fringe benefit valuation rule(s) permit employees to use a company vehicle for personal purposes as a fringe benefit? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question
Mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Mileage reimbursement rule 
B)  Lease-value rule 
C)  Commuter rule 
D)  Cents-per-mile rule 
A)  Mileage reimbursement rule 
B)  Lease-value rule 
C)  Commuter rule 
D)  Cents-per-mile rule

Question 5

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

Accepted Answer

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

Question 6

Certain fringe beneﬁts that are not part of a cafeteria plan may be reported on the employee's Form W-2 as income.

Accepted Answer

A) True 
 B)False

Question 7

All employee contributions to qualiﬁed Premium-Only Plans (POP) and Flexible Spending Arrangements (FSA) are deducted on a pre-tax basis.

Accepted Answer

A) True 
 B)False

Question 8

Hattie Bowers 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 8 miles each way and she worked 220 days. What is the amount of the company-car fringe beneﬁt that will appear on her W-2? (Do not round intermediate
Calculations.)

Accepted Answer

A)  $4,680.00 
B)  $5,280.00 
C)  $2,640.00 
D)  $2,140.00 
A)  $4,680.00 
B)  $5,280.00 
C)  $2,640.00 
D)  $2,140.00

Question 9

Which of the following is an example of a post-tax mandated deduction? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any
Boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Credit card liens 
B)  Tax liens 
C)  Garnishments 
D)  Charitable contributions 
A)  Credit card liens 
B)  Tax liens 
C)  Garnishments 
D)  Charitable contributions

Question 10

The purpose of fringe beneﬁts is to ________.

Accepted Answer

A)  entice employee engagement 
B)  defer tax obligations 
C)  avoid cash outlays for employee beneﬁts 
D)  reduce taxable compensation 
A)  entice employee engagement 
B)  defer tax obligations 
C)  avoid cash outlays for employee beneﬁts 
D)  reduce taxable compensation

Question 11

According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Accepted Answer

A)  $2,000 
B)  $1,400 
C)  $800 
D)  $1,600 
A)  $2,000 
B)  $1,400 
C)  $800 
D)  $1,600

Question 12

Ronald Ferrer is an employee who drives a 2019 Chevrolet Malibu as a company car. The fair-market value of the car is $23,175. He has been given the choice to have his fringe beneﬁt reported on his W-2 either using the lease-value rule or the cents-per mile rule. According to Publication 15-b, the lease value is
$6,350. He has driven 2,500 miles for personal use and 23,500 miles in total during the year. The car has been available for use on 250 days during the year.
Ronald's employer pays for all fuel. What method and valuation will yield the lowest fringe-beneﬁt amount for Ronald? (Do not round intermediate calculations,
Only round ﬁnal answer to two decimal points.)

Accepted Answer

A)  Lease-value, $1,450 
B)  Cents-per-mile, $1,450 
C)  Lease-value, $600.19 
D)  Cents-per-mile, $600.19 
A)  Lease-value, $1,450 
B)  Cents-per-mile, $1,450 
C)  Lease-value, $600.19 
D)  Cents-per-mile, $600.19

Question 13

Over ________ of U.S. employees report that fringe beneﬁts affect their choice of employers.

Accepted Answer

A)  25% 
B)  10% 
C)  40% 
D)  50% 
A)  25% 
B)  10% 
C)  40% 
D)  50%

Question 14

If an employer paid for its employees' long-term care insurance premiums, who determines the effect on the employees' gross pay?

Accepted Answer

A)  The IRS 
B)  The employer 
C)  The employee 
D)  The state in which the business is located 
A)  The IRS 
B)  The employer 
C)  The employee 
D)  The state in which the business is located

Question 15

Retirement fund contributions are generally subject to ________ and ________ taxes.

Accepted Answer

A)  Federal withholding; Social Security 
B)  Federal withholding; State withholding 
C)  Federal withholding; Medicare 
D)  Social Security; Medicare 
A)  Federal withholding; Social Security 
B)  Federal withholding; State withholding 
C)  Federal withholding; Medicare 
D)  Social Security; Medicare

Question 16

Which of the following, according to the IRS, is used to determine if a health plan qualifies for pre-tax status? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to
Empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

Accepted Answer

A)  Cancer and accident policies 
B)  An employer's self-insured plan 
C)  COBRA health coverage 
D)  Retiree health coverage 
A)  Cancer and accident policies 
B)  An employer's self-insured plan 
C)  COBRA health coverage 
D)  Retiree health coverage

Question 17

What is the purpose of pre-tax deductions?

Accepted Answer

A)  To reduce the ﬁnancial burden on families 
B)  To reduce the ﬁnancial burden on employers 
C)  To support proactive health care 
D)  To reduce the amount of tax revenue available 
A)  To reduce the ﬁnancial burden on families 
B)  To reduce the ﬁnancial burden on employers 
C)  To support proactive health care 
D)  To reduce the amount of tax revenue available

Question 18

Contributions to FSAs in excess of what annual amount are treated as taxable income?

Accepted Answer

A)  $1,930 
B)  $2,370 
C)  $1,660 
D)  $2,700 
A)  $1,930 
B)  $2,370 
C)  $1,660 
D)  $2,700

Question 19

Post-Tax Deductions are amounts ________.

Accepted Answer

A)  are only mandatory deductions like garnishments and union dues 
B)  that the employer chooses to withhold after assessing the employee's tax liability 
C)  that are voluntarily chosen by the employee 
D)  includes both mandatory and voluntary deductions 
A)  are only mandatory deductions like garnishments and union dues 
B)  that the employer chooses to withhold after assessing the employee's tax liability 
C)  that are voluntarily chosen by the employee 
D)  includes both mandatory and voluntary deductions

Question 20

What is a limit on garnishments for nontax liens?

Accepted Answer

A)  It may not exceed 15% of an employee's disposable income. 
B)  It may not exceed 30 times the federal minimum wage. 
C)  An additional 5% may be added for any lien payments in arrears. 
D)  It may be up to 50% of an employee's disposable income. 
A)  It may not exceed 15% of an employee's disposable income. 
B)  It may not exceed 30 times the federal minimum wage. 
C)  An additional 5% may be added for any lien payments in arrears. 
D)  It may be up to 50% of an employee's disposable income.

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

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

According to the Affordable Health Care Act, employers with ________ or more employees are required to ﬁle an informational return with the IRS and a detailed summary to the employees.

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

Certain fringe beneﬁts that are not part of a cafeteria plan may be reported on the employee's Form W-2 as income.

All employee contributions to qualiﬁed Premium-Only Plans (POP) and Flexible Spending Arrangements (FSA) are deducted on a pre-tax basis.

The purpose of fringe beneﬁts is to ________.

According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Over ________ of U.S. employees report that fringe beneﬁts affect their choice of employers.

If an employer paid for its employees' long-term care insurance premiums, who determines the effect on the employees' gross pay?

Retirement fund contributions are generally subject to and taxes.

What is the purpose of pre-tax deductions?

Contributions to FSAs in excess of what annual amount are treated as taxable income?

Post-Tax Deductions are amounts ________.

What is a limit on garnishments for nontax liens?

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

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

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

According to the Affordable Health Care Act, employers with ________ or more employees are required to ﬁle an informational return with the IRS and a detailed summary to the employees.

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

Certain fringe beneﬁts that are not part of a cafeteria plan may be reported on the employee's Form W-2 as income.

All employee contributions to qualiﬁed Premium-Only Plans (POP) and Flexible Spending Arrangements (FSA) are deducted on a pre-tax basis.

The purpose of fringe beneﬁts is to ________.

According to Publication 15b, what is the annual cash value limit for excluded qualiﬁed achievement awards?

Over ________ of U.S. employees report that fringe beneﬁts affect their choice of employers.

If an employer paid for its employees' long-term care insurance premiums, who determines the effect on the employees' gross pay?

Retirement fund contributions are generally subject to ________ and ________ taxes.

What is the purpose of pre-tax deductions?

Contributions to FSAs in excess of what annual amount are treated as taxable income?

Post-Tax Deductions are amounts ________.

What is a limit on garnishments for nontax liens?

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

Retirement fund contributions are generally subject to and taxes.