Question 1

Which of the following is true about document retention requirements per the IRS statute of limitations?

Accepted Answer

A) Federal legislation requires documents to be retained for two years after the employee's termination. 
B) Payroll records must be maintained for three years after termination. 
C) Union employees' records must be retained for ﬁve years after termination. 
D) State legislation requires records to be retained for a minimum of eight years after termination.

Question 2

IRS Regulation 26 CFR 1.6001 mandates ____ procedures as they pertain to payroll records, noting that it is the responsibility of the ____ .

Accepted Answer

A) employee time review; department manager 
B) ﬁle maintenance; employer 
C) payroll review; payroll supervisor 
D) check authorization; controller

Question 3

Which of the following items must exist in every employee's payroll ﬁle?

Accepted Answer

A) Spouse's birth date 
B) Spouse's social security number 
C) Employment history 
D) Occupation

Question 4

Which of the following is an example of a typical exempt salaried employee?

Accepted Answer

A) Operations Manager. 
B) Machine Operator. 
C) Accounting Clerk. 
D) Administrative Assistant.

Question 5

Which pay frequency has generally 26 pay periods per year?

Accepted Answer

A) Bimonthly 
B) Semimonthly 
C) Semi-weekly 
D) Biweekly

Question 6

What forms are required when an employee is hired? (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) SS-4 
B) I-9 
C) W-2 
D) W-4

Question 7

S. workers in foreign subsidiaries are exempt from all income taxes.

Accepted Answer

A) True 
 B)False

Question 8

Veriﬁcation of hours worked and pay accuracy is part of the ____.

Accepted Answer

A) accounts payable reconciliation 
B) payroll review process 
C) disbursement cycle 
D) CEO's responsibility

Question 9

____payroll is processed every two weeks and will usually result in a lower gross pay per pay period than _____payroll.

Accepted Answer

A) Biweekly; semimonthly 
B) Daily; biweekly 
C) Weekly; monthly 
D) Semimonthly; biweekly

Question 10

Which of the following is a necessary element in an accounting system? (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) Audit review 
B) Internal control 
C) Internal review 
D) Audit control

Question 11

Which of the following is/are purpose(s) of new hire reporting laws? (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) To keep track of workers and professionals who are subject to licensing regulations. 
B) To ensure payment of court-ordered obligations like garnishments and child support. 
C) To keep track of workers throughout their careers. 
D) To ensure that the employee may legally work in the United States.

Question 12

Jeremiah is a salaried exempt worker whose standard workday consists of eight-hour shifts. During a workweek, he exceeded eight hours of work on two separate days but did not exceed 40 hours during the work week. What is the FLSA provision for the time that he worked past eight hours in a single day?

Accepted Answer

A) He will receive no additional compensation for the extra time worked. 
B) He must alert his manager of the extra time on the next business day. 
C) He must be compensated at overtime rates for any hours past eight in a single day. 
D) He must reduce the time he works on subsequent days.

Question 13

Ibrahim is the payroll accountant for a ﬁrm. He notes that the ﬁrm has hired a new employee. What forms must he collect from the new employee?

Accepted Answer

A) W-4 and I-8 
B) W-4 and I-9 
C) W-2 and I-9 
D) W-3 and I-9

Question 14

What is the difference in pay practices between salaried exempt and salaried nonexempt workers?

Accepted Answer

A) Salaried nonexempt workers must not work overtime hours. 
B) Salaried nonexempt workers are eligible for overtime pay. 
C) Salaried exempt workers must work between 45 and 50 hours per week. 
D) Salaried exempt workers may only work eight hours per day.

Question 15

Foreign workers in the United States are subject to new hire reporting regulations.

Accepted Answer

A) True 
 B)False

Question 16

Georgeanne works in a company for which her primary job function is the sale of company products to consumers. She receives a percentage of each sale as part of her compensation. Her compensation contains a ____  element.

Accepted Answer

A) pay-for-performance 
B) nonexempt 
C) commission 
D) piece-rate

Question 17

A worker who sells life insurance on a full-time basis is considered a statutory employee.

Accepted Answer

A) True 
 B)False

Question 18

Employers may choose to omit the employees' Social Security numbers in their employee ﬁles.

Accepted Answer

A) True 
 B)False

Question 19

Multistate employers must do which of the following for new hire reporting? (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) File a new-hire report with both the state that contains the firm's headquarters and the state that is the employee's primary residence. 
B) File a report with the state offices for the employee's state of residence. 
C) Designate which state will receive their new hire reporting. 
D) File a report with the IRS since they have employees in multiple states.

Question 20

All executive compensation must be:

Accepted Answer

A) Annotated as to derivation and benchmarks from similar companies. 
B) Reported with the company's ﬁnancial statements. 
C) Maintained in a ﬁle and purged annually. 
D) Available for inspection by any interested party.

Exam 2: Computing Wages and Salaries

Which of the following is true about document retention requirements per the IRS statute of limitations?

IRS Regulation 26 CFR 1.6001 mandates procedures as they pertain to payroll records, noting that it is the responsibility of the .

Which of the following items must exist in every employee's payroll ﬁle?

Which of the following is an example of a typical exempt salaried employee?

Which pay frequency has generally 26 pay periods per year?

S. workers in foreign subsidiaries are exempt from all income taxes.

Veriﬁcation of hours worked and pay accuracy is part of the ____.

payroll is processed every two weeks and will usually result in a lower gross pay per pay period than _payroll.

Ibrahim is the payroll accountant for a ﬁrm. He notes that the ﬁrm has hired a new employee. What forms must he collect from the new employee?

What is the difference in pay practices between salaried exempt and salaried nonexempt workers?

Foreign workers in the United States are subject to new hire reporting regulations.

Georgeanne works in a company for which her primary job function is the sale of company products to consumers. She receives a percentage of each sale as part of her compensation. Her compensation contains a ____ element.

A worker who sells life insurance on a full-time basis is considered a statutory employee.

Employers may choose to omit the employees' Social Security numbers in their employee ﬁles.

All executive compensation must be: