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PAYROLL FUNDAMENTAL MIDTERM EXAM
2025 UPDATED ACTUAL EXAM WITH
CORRECT SOLUTIONS.
Which of the following regulations is governed by both the state
and the federal governments?
1 Method of payment
2 Final pay to a terminated employee
3 Exempt/nonexempt status
4 Breaks - correct answer- 3 (Both federal and state wage and
hour laws govern minimum wage, overtime and an employee's
exempt status.)
Which of the following amounts are included in the calculation
of an employee's regular rate of pay?
1 Pay for hours not worked
2 Shift premiums
3 Employer benefit plan contributions
4 De minimis holiday gifts - correct answer- 2 (The FLSA
defines regular rate of pay as the total regular pay for all hours
work divided by the hours worked in the workweek. The FLSA
exempts the following types of pay from the regular rate of pay
- gifts, paid time off, reimbursed expenses, discretionary
bonuses, benefit plan contributions, and others.)
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For more information, refer to Module 1, Lesson 4
All of the following items are covered by the Fair Labor
Standards Act EXCEPT:
1 defining equal pay for equal work.
2 defining when escheat laws apply.
3 setting child labor restrictions.
4 setting the minimum age for work. - correct answer- 2 (The
FLSA regulates overtime, minimum wage, child labor, and
equal pay.)
For more information, refer to Module 1, Lesson 4
Under the FLSA, an employee under the age of 20 can be paid
the opportunity wage for a maximum of:
1. 30 calendar days.
2. 60 calendar days.
3. 90 calendar days.
4. 120 calendar days. - correct answer- 3 (Under the FLSA, an
employee under the age of 20 can be paid the opportunity
wage of $4.25 per hour for a maximum of 90 calendar days.)
RATIONALE
For more information, refer to Module 1, Lesson 4
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Under the FLSA, when a nonexempt employee receives a
retroactive pay increase, over what period of time, if any, will
the new pay rate impact the employee's overtime premium?
• The entire period of the retroactive increase
b. Only the current workweek
c. Only the current pay period
d. It does not have to be considered in the overtime premium -
correct answer- 1 (Under the FLSA, when a nonexempt
employee receives a retroactive pay increase, the new pay rate
impacts the employee's overtime premium for the entire period
of the retroactive increase.)
SSN stands for - correct answer- Social Security Number
What does an I-9 Form stands for? - correct answer- The
Employment Eligibility Verification Form
What is the Employement Eligibility Verication Form code? -
correct answer- I-9
What does the Employment Verification Form do? - correct
answer- This proves that the employee can work in the United
States.
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What does the I-9 form do? - correct answer- This proves that
the employee can work in the United States.
What does a W-4 form stands for? - correct answer- The
Employee's Witholding Allowance Certificate
What is the code form for The Employee's Witholding
Allowance Certificate? - correct answer- W-4
What does the W-4 form do? - correct answer- It is used to
calculate the federal income taxeach emloyee owes each pay
period. These taxes are subtracted from each paycheck
What does the Employee's Withholding Allance Certificate do? -
correct answer- It is used to calculate the federal income
taxeach emloyee owes each pay period. These taxes are
subtracted from each paycheck
Do all states have State taxes? - correct answer- NO
PAYROLL FUNDAMENTAL MIDTERM EXAM
2025 UPDATED ACTUAL EXAM WITH
CORRECT SOLUTIONS.
Which of the following regulations is governed by both the state
and the federal governments?
1 Method of payment
2 Final pay to a terminated employee
3 Exempt/nonexempt status
4 Breaks - correct answer- 3 (Both federal and state wage and
hour laws govern minimum wage, overtime and an employee's
exempt status.)
Which of the following amounts are included in the calculation
of an employee's regular rate of pay?
1 Pay for hours not worked
2 Shift premiums
3 Employer benefit plan contributions
4 De minimis holiday gifts - correct answer- 2 (The FLSA
defines regular rate of pay as the total regular pay for all hours
work divided by the hours worked in the workweek. The FLSA
exempts the following types of pay from the regular rate of pay
- gifts, paid time off, reimbursed expenses, discretionary
bonuses, benefit plan contributions, and others.)
,2 | Page
For more information, refer to Module 1, Lesson 4
All of the following items are covered by the Fair Labor
Standards Act EXCEPT:
1 defining equal pay for equal work.
2 defining when escheat laws apply.
3 setting child labor restrictions.
4 setting the minimum age for work. - correct answer- 2 (The
FLSA regulates overtime, minimum wage, child labor, and
equal pay.)
For more information, refer to Module 1, Lesson 4
Under the FLSA, an employee under the age of 20 can be paid
the opportunity wage for a maximum of:
1. 30 calendar days.
2. 60 calendar days.
3. 90 calendar days.
4. 120 calendar days. - correct answer- 3 (Under the FLSA, an
employee under the age of 20 can be paid the opportunity
wage of $4.25 per hour for a maximum of 90 calendar days.)
RATIONALE
For more information, refer to Module 1, Lesson 4
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Under the FLSA, when a nonexempt employee receives a
retroactive pay increase, over what period of time, if any, will
the new pay rate impact the employee's overtime premium?
• The entire period of the retroactive increase
b. Only the current workweek
c. Only the current pay period
d. It does not have to be considered in the overtime premium -
correct answer- 1 (Under the FLSA, when a nonexempt
employee receives a retroactive pay increase, the new pay rate
impacts the employee's overtime premium for the entire period
of the retroactive increase.)
SSN stands for - correct answer- Social Security Number
What does an I-9 Form stands for? - correct answer- The
Employment Eligibility Verification Form
What is the Employement Eligibility Verication Form code? -
correct answer- I-9
What does the Employment Verification Form do? - correct
answer- This proves that the employee can work in the United
States.
, 4 | Page
What does the I-9 form do? - correct answer- This proves that
the employee can work in the United States.
What does a W-4 form stands for? - correct answer- The
Employee's Witholding Allowance Certificate
What is the code form for The Employee's Witholding
Allowance Certificate? - correct answer- W-4
What does the W-4 form do? - correct answer- It is used to
calculate the federal income taxeach emloyee owes each pay
period. These taxes are subtracted from each paycheck
What does the Employee's Withholding Allance Certificate do? -
correct answer- It is used to calculate the federal income
taxeach emloyee owes each pay period. These taxes are
subtracted from each paycheck
Do all states have State taxes? - correct answer- NO
