CPP Basic 2

Question 1

An employee is paid $18/hr and works 50 hours in a workweek. What is their total gross pay under FLSA?

Accepted Answer

$990.00

Answer

Regular pay: 40 × $18 = $720; overtime: 10 × $27 (1.5 × $18) = $270; total gross pay = $990.

Question 2

Which IRS form is used to report an employee's annual wages and taxes withheld?

Accepted Answer

Form W-2

Answer

Form W-2 reports annual wages paid and taxes withheld for each employee and must be furnished by January 31.

Question 3

What is the current Social Security tax rate paid by each employee (employee share only)?

Accepted Answer

6.20%

Answer

The employee Social Security (OASDI) tax rate is 6.2%, and the employer matches the same 6.2%.

Question 4

Which of the following fringe benefits is generally excluded from an employee's gross income?

Accepted Answer

Employer-paid health insurance premiums

Answer

Employer-paid health insurance premiums are excluded from employees' gross income under IRC §106.

Question 5

A company changes payroll frequency from biweekly to semimonthly. How many paychecks will employees receive per year under the new schedule?

Accepted Answer

24

Answer

Semimonthly means twice per month, resulting in 24 paychecks per year (2 × 12 months).

CPP - Certified Payroll Professional Practice Test