Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

Which of the following are important decisions that an employer must make regarding its payroll procedures? (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)  How often to pay employees 
B)  Which employee benefits to offer 
C)  How to handle pay advances 
D)  How many employees to hire

Question 3

A ___________ employee is eligible for company beneﬁts whereas a ________ employee is not.

Accepted Answer

A)  independent contractor; temporary 
B)  temporary; part-time 
C)  leased; temporary 
D)  temporary; leased

Question 4

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 5

Pay rate is the ﬁrst payroll system decision a company must make.

Accepted Answer

A) True 
 B)False

Question 6

Well-designed internal controls promote: (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 trail support. 
B)  Protection against embezzlement. 
C)  Legal compliance and file integrity. 
D)  Opportunities for defalcation.

Question 7

Semimonthly payroll involves a pay cycle in which pay disbursements occur every two weeks.

Accepted Answer

A) True 
 B)False

Question 8

Adrienne is a nonexempt employee who works for a ﬁrm that has an elected workweek composed of four 10-hour days and pays overtime after 40 hours worked per week. What is the rule about
Overtime for her work situation?

Accepted Answer

A)  She must be compensated for all hours worked past 8 in a single day. 
B)  She will receive overtime pay when working more than 10 hours during a shift. 
C)  She is not eligible for overtime pay. 
D)  She receives overtime only when she works past 40 hours in any given week.

Question 9

Which aspect of internal controls for payroll relates to the Sarbanes-Oxley Act?

Accepted Answer

A)  Protecting employee retirement funds 
B)  Cross-training employees and altering duties 
C)  Limiting the number of employees authorized to disburse payroll 
D)  Ensuring the complexity of the audit trail

Question 10

Which of the following is a purpose of 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)  Communications of ethics violations for clerical workers 
B)  COBRA benefits administration 
C)  Child support obligations tracking 
D)  Immigration agency tracking

Question 11

Which of the following parties does not legally have access to a ﬁrm's payroll records?

Accepted Answer

A)  The IRS 
B)  The Department of Homeland Security 
C)  State revenue department employees 
D)  All employees of the ﬁrm

Question 12

Newly hired employees must be reported to governmental oﬃcials within 20 days of starting work
for an employer.

Accepted Answer

A) True 
 B)False

Question 13

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 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

Stan works for a bakery for which part of his compensation is based on the decoration of wedding and other specialty cakes. His compensation has a ________ element.

Accepted Answer

A)  nonexempt 
B)  commission 
C)  piece-rate 
D)  performance incentive

Question 16

If a ﬁrm pays its employees biweekly, how often does it disburse employee compensation?

Accepted Answer

A)  Every two weeks 
B)  Twice per week 
C)  Every three weeks 
D)  Every week

Question 17

Only regular working hours are considered as the worked hours for overtime computation.

Accepted Answer

A) True 
 B)False

Question 18

Which pay frequency has generally 26 pay periods per year?

Accepted Answer

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

Question 19

Leased employees must have the following characteristics: (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)  The recipient company must substantially direct their work activities. 
B)  They must work part-time. 
C)  A formal agreement between the employee and employer must exist. 
D)  They must work full-time.

Question 20

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

Exam 2: Payroll System Procedures

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

A ___ employee is eligible for company beneﬁts whereas a employee is not.

Pay rate is the ﬁrst payroll system decision a company must make.

Semimonthly payroll involves a pay cycle in which pay disbursements occur every two weeks.

Adrienne is a nonexempt employee who works for a ﬁrm that has an elected workweek composed of four 10-hour days and pays overtime after 40 hours worked per week. What is the rule about Overtime for her work situation?

Which aspect of internal controls for payroll relates to the Sarbanes-Oxley Act?

Which of the following parties does not legally have access to a ﬁrm's payroll records?

Newly hired employees must be reported to governmental oﬃcials within 20 days of starting work for an employer.

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

Stan works for a bakery for which part of his compensation is based on the decoration of wedding and other specialty cakes. His compensation has a ________ element.

If a ﬁrm pays its employees biweekly, how often does it disburse employee compensation?

Only regular working hours are considered as the worked hours for overtime computation.

Which pay frequency has generally 26 pay periods per year?

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