Payroll Processing & Systems Flashcards
7 cards from real CPS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Payroll Processing & Systems flashcards as text
A company switches from a semi-monthly to a biweekly pay frequency. Which of the following is a key consideration during the transition?
Answer: Annual withholding calculations must be recalibrated to the new pay period divisor
Switching pay frequencies requires recalculating per-period withholding amounts using the correct annual-to-period divisor for the new schedule.
Which payroll system configuration controls how overtime is calculated for an employee who works in two departments with different pay rates during the same workweek?
Answer: Blended rate rule
The blended (weighted average) rate rule computes the regular rate across all hours and rates worked, then applies the 0.5x overtime premium.
During payroll processing, a system interface fails to transfer hours from the timekeeping system. What is the BEST immediate action?
Answer: Manually enter hours from supervisor-approved time records after verifying totals
Manually entering hours from verified, supervisor-approved records ensures employees are paid accurately and on time while the interface issue is resolved.
A payroll specialist receives a garnishment order specifying withholding under Title III of the Consumer Credit Protection Act (CCPA). What does Title III protect?
Answer: The employee's disposable earnings from excessive withholding
Title III of the CCPA limits the amount of an employee's disposable earnings that may be garnished in any workweek.
Which of the following best describes a 'positive pay' file in payroll operations?
Answer: A file sent to the bank identifying authorized checks to prevent fraud
A positive pay file is transmitted to the employer's bank listing issued check numbers and amounts so the bank can flag unauthorized items.
An employee's Form W-4 claims 'Exempt' from federal income tax withholding. When must the employee submit a new W-4 to maintain exempt status each year?
Answer: By February 15 of the following year
Exempt W-4 claims expire annually and must be renewed by February 15 of the new year; otherwise the employer must withhold at the default single rate.
Which payroll journal entry correctly records the employer's matching FICA liability for a $10,000 gross payroll period (Social Security rate 6.2%, Medicare rate 1.45%)?
Answer: Debit Payroll Tax Expense $765; Credit FICA Payable $765
The employer matches 7.65% ($765) of gross wages, recorded as a debit to Payroll Tax Expense and a credit to FICA Payable.