ADP Payroll Accounting and Reconciliation 2

Question 1

What is the difference between a payroll void and a payroll reversal in ADP?

Accepted Answer

A void cancels a check before it is processed by the bank; a reversal recalls a direct deposit after it has been submitted to the ACH network

Answer

A void is used for direct deposits; a reversal is used for paper checks

Answer

Both terms refer to the same process in ADP

Answer

A void requires IRS notification; a reversal does not

Question 2

Which ADP report best supports the preparation of workers' compensation premium audits?

Accepted Answer

Payroll Detail by Workers' Compensation Code Report

Answer

Employee Earnings Summary

Answer

Benefits Deduction Summary Report

Answer

Tax Liability Report

Question 3

If the bank account reconciliation shows a discrepancy between the net payroll amount and the amount transferred, what is the most likely cause?

Accepted Answer

An uncashed paycheck, a reversed direct deposit, or a bank error not yet reflected in ADP

Answer

An incorrect tax rate applied during the payroll run

Answer

A benefit deduction that was double-posted

Answer

An employee's W-4 was not updated in time

Question 4

What is the significance of the ADP 'off-cycle' payroll run and when is it typically used?

Accepted Answer

An off-cycle run processes payments outside the normal pay schedule, typically for corrections, final paychecks, or bonus payments

Answer

An off-cycle run is used to process automatic pay increases only

Answer

An off-cycle run is a test payroll that does not generate real payments

Answer

An off-cycle run is required for all employees on commission

Question 5

What is a 'suspense account' in the context of payroll accounting and why is it a problem?

Accepted Answer

A temporary holding account for transactions that cannot be immediately classified; unresolved suspense balances distort financial statements

Answer

An account used to hold payroll reserves for future periods

Answer

An account for pre-tax benefit contributions pending carrier remittance

Answer

A separate account used for contractor payments

Question 6

In ADP, what does the 'labor distribution' feature do for payroll accounting?

Accepted Answer

It allocates payroll costs across multiple departments, cost centers, or projects based on predefined percentage splits or hours worked

Answer

It calculates overtime based on shift differentials

Answer

It distributes direct deposit payments across multiple employee bank accounts

Answer

It assigns workers' compensation codes to job titles