Business Services Business Services 3 — Questions and Answers
Question 1: A staffing agency places a temp worker at a client company. Who is typically responsible for payroll taxes for that worker?
- The client company
- The temp worker themselves
- The staffing agency (Correct answer)
- The state labor department
Correct answer: The staffing agency
In a typical temp staffing arrangement, the agency is the employer of record and is responsible for payroll taxes, benefits, and compliance.
Question 2: What is the purpose of a non-disclosure agreement (NDA) in a business services context?
- To set payment terms between buyer and seller
- To prevent sharing of confidential information with outside parties (Correct answer)
- To define employee performance expectations
- To register a trademark with the USPTO
Correct answer: To prevent sharing of confidential information with outside parties
An NDA legally binds parties to keep specified confidential information secret, protecting trade secrets and proprietary data during business dealings.
Question 3: Which of the following is a key advantage of using a Professional Employer Organization (PEO)?
- The PEO takes full ownership of the client business
- The PEO eliminates the need for any employees
- The PEO co-employs workers and handles HR, payroll, and benefits administration (Correct answer)
- The PEO provides the client with government grants
Correct answer: The PEO co-employs workers and handles HR, payroll, and benefits administration
PEOs enter a co-employment arrangement, allowing small businesses to access Fortune-500-level HR services, benefits, and compliance support.
Question 4: A law firm bills clients based on the number of hours worked multiplied by an hourly rate. This is called:
- Retainer billing
- Contingency fee
- Hourly billing (Correct answer)
- Value-based pricing
Correct answer: Hourly billing
Hourly billing charges clients based on the actual time spent on their matter at a predetermined rate per hour.
Question 5: What is 'accounts payable' in a business context?
- Revenue earned but not yet collected
- Money the business owes to its suppliers or vendors (Correct answer)
- Employee wages owed at the end of a pay period
- Loans provided to other businesses
Correct answer: Money the business owes to its suppliers or vendors
Accounts payable represents short-term obligations a company owes to suppliers for products or services received but not yet paid for.
Question 6: Which business service specializes in helping companies reduce their tax liability while remaining legally compliant?
- Management consulting
- Tax planning and accounting services (Correct answer)
- Business process outsourcing (BPO)
- Market research
Correct answer: Tax planning and accounting services
Tax planning services analyze a company's financial situation to identify legal strategies that minimize tax obligations.
Question 7: A company that handles customer service, data entry, and back-office tasks on behalf of another company is providing:
- Mergers and acquisitions (M&A) advisory
- Business Process Outsourcing (BPO) (Correct answer)
- Venture capital services
- Executive recruitment
Correct answer: Business Process Outsourcing (BPO)
BPO involves contracting specific business processes—like customer service, payroll, or data processing—to a third-party service provider.
Business Services Business Services 3
A staffing agency places a temp worker at a client company.
Who is typically responsible for payroll taxes for that worker?