PAYROLL FUNDAMENTAL MIDTERM
EXAM 2025 QUESTIONS AND ANSWERS
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 - ANS 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 - ANS 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.)
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. - ANS 2 (The FLSA regulates overtime, minimum wage,
child labor, and equal pay.)
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 1
,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. - ANS 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
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 - ANS 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 - ANS Social Security Number
What does an I-9 Form stands for? - ANS The Employment Eligibility Verification Form
What is the Employement Eligibility Verication Form code? - ANS I-9
What does the Employment Verification Form do? - ANS This proves that the employee can
work in the United States.
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 2
,What does the I-9 form do? - ANS This proves that the employee can work in the United
States.
What does a W-4 form stands for? - ANS The Employee's Witholding Allowance Certificate
What is the code form for The Employee's Witholding Allowance Certificate? - ANS W-4
What does the W-4 form do? - ANS 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? - ANS 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? - ANS NO
Employees who work in a state with a State Income Tax may have to fill out another form ? -
ANS Yes, another W-4 but for the State Witholding Allowance Certificate.
Does depending where the employess work and live, they may be asked to fill out form for
local, county, or city income tax withholdong. - ANS Yes
The employee's SSN sets up an account for the employee with the ________? - ANS SSA
Social Security Administration
Each year the employer (The BOSS)reports wages that are recorded in the account at SSA. -
ANS TRUE
Each month the employer (The BOSS)reports wages that are recorded in the account at SSA. -
ANS FALSE
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 3
, When the employee retires or becomes disabled, SS benefits are paid based on the total
earnings reported by the employee's employers. - ANS TRUE
When the employee retires or becomes disabled, SS benefits are paid based on half of the
earnings reported by the employee's employers. - ANS FALSE
IRS stands for? - ANS Internal Revenue Service
Who are the Internal Revenue Service? - ANS The United States' Tax Collector
The IRS uses ________as your personal taxpayer identification number when wages and taxes
are reported each year. - ANS Social Security Number
The employees yearly wages and tax information that are reported to the Social Security
Administration is shared with the IRS for income tax purposes. - ANS TRUE
The employees yearly wages and tax information that are reported to the Social Security
Administration can not be shared with the IRS for income tax purposes. - ANS FALSE
Methods of paying Employees name them: - ANS check,direct deposit, cash
Direct deposit is - ANS an electronic fund transfer of their pay directly into their bank
account.
Paycard is - ANS is a Debit payroll card to pay employees, especially when they don't have a
bank account.
All employees working in the United States must pay Federal Income and Employment taxes on
their wages. - ANS TRUE
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 4
EXAM 2025 QUESTIONS AND ANSWERS
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 - ANS 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 - ANS 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.)
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. - ANS 2 (The FLSA regulates overtime, minimum wage,
child labor, and equal pay.)
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 1
,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. - ANS 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
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 - ANS 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 - ANS Social Security Number
What does an I-9 Form stands for? - ANS The Employment Eligibility Verification Form
What is the Employement Eligibility Verication Form code? - ANS I-9
What does the Employment Verification Form do? - ANS This proves that the employee can
work in the United States.
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 2
,What does the I-9 form do? - ANS This proves that the employee can work in the United
States.
What does a W-4 form stands for? - ANS The Employee's Witholding Allowance Certificate
What is the code form for The Employee's Witholding Allowance Certificate? - ANS W-4
What does the W-4 form do? - ANS 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? - ANS 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? - ANS NO
Employees who work in a state with a State Income Tax may have to fill out another form ? -
ANS Yes, another W-4 but for the State Witholding Allowance Certificate.
Does depending where the employess work and live, they may be asked to fill out form for
local, county, or city income tax withholdong. - ANS Yes
The employee's SSN sets up an account for the employee with the ________? - ANS SSA
Social Security Administration
Each year the employer (The BOSS)reports wages that are recorded in the account at SSA. -
ANS TRUE
Each month the employer (The BOSS)reports wages that are recorded in the account at SSA. -
ANS FALSE
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 3
, When the employee retires or becomes disabled, SS benefits are paid based on the total
earnings reported by the employee's employers. - ANS TRUE
When the employee retires or becomes disabled, SS benefits are paid based on half of the
earnings reported by the employee's employers. - ANS FALSE
IRS stands for? - ANS Internal Revenue Service
Who are the Internal Revenue Service? - ANS The United States' Tax Collector
The IRS uses ________as your personal taxpayer identification number when wages and taxes
are reported each year. - ANS Social Security Number
The employees yearly wages and tax information that are reported to the Social Security
Administration is shared with the IRS for income tax purposes. - ANS TRUE
The employees yearly wages and tax information that are reported to the Social Security
Administration can not be shared with the IRS for income tax purposes. - ANS FALSE
Methods of paying Employees name them: - ANS check,direct deposit, cash
Direct deposit is - ANS an electronic fund transfer of their pay directly into their bank
account.
Paycard is - ANS is a Debit payroll card to pay employees, especially when they don't have a
bank account.
All employees working in the United States must pay Federal Income and Employment taxes on
their wages. - ANS TRUE
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 4
