Test Bank
Answers Included
Chapter 1
Processing a New Employee
Name: _______________________________________
Class: _______________________________________
Date: _______________________________________
Define the Fair Labor Standards Act
1. Which statement regarding overtime earnings is accurate?
A. Overtime wages cannot exceed 1.5 times regular wages.
B. Overtime wages cannot be less than 1.5 times regular wages.
C. Overtime wages must be paid for all hours worked during a weekend.
D. Overtime wages must be paid for all hours worked during the evening (after 8:00 p.m.).
2. Rachel is a server at a family restaurant in Omaha, NE. As a tipped employee, she receives an
hourly wage that is less than the federal minimum wage. This week, her combined hourly wages
and tips was less than the federal minimum wage. What happens next?
A. Rachel’s employer pays her additional wages to compensate for the deficit.
B. Additional pooled tips must be allocated to Rachel to compensate for the deficit.
C. This circumstance is acceptable, so no action is necessary.
D. Her employer may be required to pay her additional wages, depending on her total
earnings in subsequent weeks.
3. The period ending date on a paystub represents the _____.
A. date the paycheck was written
B. final day for which the employee is being paid on the paycheck
C. date the employee receives the paycheck
D. final working day of the calendar year
4. Which of these is NOT an earning category on a paystub?
A. Holiday
B. Regular
C. Medicare
D. Overtime
5. What does the acronym FLSA stands for?
A. Fair Labor Standards Act
B. Federal Labor Standards Act
C. Fair Labor Security Act
D. Federal Labor Security Act
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,Test Bank
6. Which group does NOT represent an exception to the federal minimum wage?
A. Workers with disabilities
B. Student learners in a vocational school
C. An employee under 20 years of age
D. A part-time student working for a college
E. None of these options
7. An employer can designate any 7-day period as a _____ as long as it begins and ends
consistently each week.
A. workweek
B. vacation
C. pay period
D. payday
8. The federal minimum wage was established in 1938 when the _____ was passed into law.
A. Fair Labor Standards Act
B. Self-Employment Contributions Act
C. Immigration Reform and Control Act
D. Employee Retirement Income Security Act
9. Match each pay category with its meaning.
A. Gross pay 1. Pay for hours worked over the standard number
B. Overtime pay of regular hours (typically 40) in a workweek
C. Net pay 2. Paycheck amount
3. Pay before deductions
10. Match each age group to its child labor restriction.
A. Under 14 1. May work only three hours on a school day
B. 14 and 15 2. May perform specific activities only
C. 16 and 17 3. May work unlimited hours
11. Match each act with the year it was passed into law.
A. 1996 1. Fair Labor Standards
B. 1938 2. Immigration Reform and Control
C. 1986 3. Personal Responsibility and Work Opportunity
Reconciliation
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,Test Bank
Utilize Circular E
12. Daniel is determining this week’s federal income tax withholding for three employees of his
sporting goods store. Where can he find the tax tables he needs to reference?
A. Circular E
B. Publication I-9
C. Publication 15
D. Publication 15-T
13. Publication 15 is also referred to as _____.
A. Circular B
B. Circular C
C. Circular D
D. Circular E
Complete Various Forms for New Employees
14. Identify each item as a component of a pre-2020 Form W-4, current Form W-4, or both.
A. Social Security number
Pre-2020 Form W-4 Current Form W-4 Both
B. Number of withholding allowances
Pre-2020 Form W-4 Current Form W-4 Both
C. Deductions
Pre-2020 Form W-4 Current Form W-4 Both
D. Filing status on tax return
Pre-2020 Form W-4 Current Form W-4 Both
E. Additional (extra) withholding
Pre-2020 Form W-4 Current Form W-4 Both
15. Pierre recently started a construction business and is hiring three employees. He wants to use
the E-Verify system, so he asks his potential employees to complete _____.
A. Form SS-4
B. Form I-9
C. Form SS-5
D. Form W-4
16. Which element does not appear on the current Form W-4?
A. A signature line
B. A line for entering anticipated weekly earnings
C. A line for “Other Income”
D. A checkbox for circumstances in which an employee has two jobs
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17. What must a company have before hiring employees?
A. Employee training
B. Social Security Administration card
C. Employer Identification Number
D. All of these things
18. Which of these is NOT an acceptable employment eligibility verification document?
A. U.S. Passport
B. Permanent Resident Card
C. Employment Authorization Document with a photograph
D. State ID
19. What is Form SS-4 used to request?
A. Taxpayer Identification Number
B. Employer Identification Number
C. Withholding allowances
D. Social Security number
20. What is Form SS-5 used to request?
A. Taxpayer Identification Number
B. Employer Identification Number
C. Withholding allowances
D. Social Security number
21. Which element is part of the new Form W-4 introduced in 2020?
A. Personal Allowances worksheet
B. Area to indicate Exempt status for employees not subject to federal income tax
withholding
C. Multiple Jobs checkbox
D. Box to enter driver’s license information
22. What statement about Form I-9 is accurate?
A. The employee submits one or two documents to verify employment eligibility.
B. It was significantly revised and expanded in 2020.
C. A company submits this to request an EIN.
D. It is also referred to as Publication 15.
23. What is the title for Form W-4 (2020 or later version)?
A. Application for Employer Identification Number
B. Application for a Social Security Card
C. Employee’s Withholding Certificate
D. Employment Eligibility Verification
Payroll Accounting Page 4 of 7
Answers Included
Chapter 1
Processing a New Employee
Name: _______________________________________
Class: _______________________________________
Date: _______________________________________
Define the Fair Labor Standards Act
1. Which statement regarding overtime earnings is accurate?
A. Overtime wages cannot exceed 1.5 times regular wages.
B. Overtime wages cannot be less than 1.5 times regular wages.
C. Overtime wages must be paid for all hours worked during a weekend.
D. Overtime wages must be paid for all hours worked during the evening (after 8:00 p.m.).
2. Rachel is a server at a family restaurant in Omaha, NE. As a tipped employee, she receives an
hourly wage that is less than the federal minimum wage. This week, her combined hourly wages
and tips was less than the federal minimum wage. What happens next?
A. Rachel’s employer pays her additional wages to compensate for the deficit.
B. Additional pooled tips must be allocated to Rachel to compensate for the deficit.
C. This circumstance is acceptable, so no action is necessary.
D. Her employer may be required to pay her additional wages, depending on her total
earnings in subsequent weeks.
3. The period ending date on a paystub represents the _____.
A. date the paycheck was written
B. final day for which the employee is being paid on the paycheck
C. date the employee receives the paycheck
D. final working day of the calendar year
4. Which of these is NOT an earning category on a paystub?
A. Holiday
B. Regular
C. Medicare
D. Overtime
5. What does the acronym FLSA stands for?
A. Fair Labor Standards Act
B. Federal Labor Standards Act
C. Fair Labor Security Act
D. Federal Labor Security Act
Payroll Accounting Page 1 of 7
,Test Bank
6. Which group does NOT represent an exception to the federal minimum wage?
A. Workers with disabilities
B. Student learners in a vocational school
C. An employee under 20 years of age
D. A part-time student working for a college
E. None of these options
7. An employer can designate any 7-day period as a _____ as long as it begins and ends
consistently each week.
A. workweek
B. vacation
C. pay period
D. payday
8. The federal minimum wage was established in 1938 when the _____ was passed into law.
A. Fair Labor Standards Act
B. Self-Employment Contributions Act
C. Immigration Reform and Control Act
D. Employee Retirement Income Security Act
9. Match each pay category with its meaning.
A. Gross pay 1. Pay for hours worked over the standard number
B. Overtime pay of regular hours (typically 40) in a workweek
C. Net pay 2. Paycheck amount
3. Pay before deductions
10. Match each age group to its child labor restriction.
A. Under 14 1. May work only three hours on a school day
B. 14 and 15 2. May perform specific activities only
C. 16 and 17 3. May work unlimited hours
11. Match each act with the year it was passed into law.
A. 1996 1. Fair Labor Standards
B. 1938 2. Immigration Reform and Control
C. 1986 3. Personal Responsibility and Work Opportunity
Reconciliation
Payroll Accounting Page 2 of 7
,Test Bank
Utilize Circular E
12. Daniel is determining this week’s federal income tax withholding for three employees of his
sporting goods store. Where can he find the tax tables he needs to reference?
A. Circular E
B. Publication I-9
C. Publication 15
D. Publication 15-T
13. Publication 15 is also referred to as _____.
A. Circular B
B. Circular C
C. Circular D
D. Circular E
Complete Various Forms for New Employees
14. Identify each item as a component of a pre-2020 Form W-4, current Form W-4, or both.
A. Social Security number
Pre-2020 Form W-4 Current Form W-4 Both
B. Number of withholding allowances
Pre-2020 Form W-4 Current Form W-4 Both
C. Deductions
Pre-2020 Form W-4 Current Form W-4 Both
D. Filing status on tax return
Pre-2020 Form W-4 Current Form W-4 Both
E. Additional (extra) withholding
Pre-2020 Form W-4 Current Form W-4 Both
15. Pierre recently started a construction business and is hiring three employees. He wants to use
the E-Verify system, so he asks his potential employees to complete _____.
A. Form SS-4
B. Form I-9
C. Form SS-5
D. Form W-4
16. Which element does not appear on the current Form W-4?
A. A signature line
B. A line for entering anticipated weekly earnings
C. A line for “Other Income”
D. A checkbox for circumstances in which an employee has two jobs
Payroll Accounting Page 3 of 7
, Test Bank
17. What must a company have before hiring employees?
A. Employee training
B. Social Security Administration card
C. Employer Identification Number
D. All of these things
18. Which of these is NOT an acceptable employment eligibility verification document?
A. U.S. Passport
B. Permanent Resident Card
C. Employment Authorization Document with a photograph
D. State ID
19. What is Form SS-4 used to request?
A. Taxpayer Identification Number
B. Employer Identification Number
C. Withholding allowances
D. Social Security number
20. What is Form SS-5 used to request?
A. Taxpayer Identification Number
B. Employer Identification Number
C. Withholding allowances
D. Social Security number
21. Which element is part of the new Form W-4 introduced in 2020?
A. Personal Allowances worksheet
B. Area to indicate Exempt status for employees not subject to federal income tax
withholding
C. Multiple Jobs checkbox
D. Box to enter driver’s license information
22. What statement about Form I-9 is accurate?
A. The employee submits one or two documents to verify employment eligibility.
B. It was significantly revised and expanded in 2020.
C. A company submits this to request an EIN.
D. It is also referred to as Publication 15.
23. What is the title for Form W-4 (2020 or later version)?
A. Application for Employer Identification Number
B. Application for a Social Security Card
C. Employee’s Withholding Certificate
D. Employment Eligibility Verification
Payroll Accounting Page 4 of 7
