Fundamental Payroll Systems and Administration Flashcards
7 cards from real Fundamental Payroll Certification practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Fundamental Payroll Systems and Administration flashcards as text
A payroll administrator discovers that an employee was overpaid by $500 in the prior pay period. What is the best first step?
Answer: Notify the employee and establish a repayment plan in compliance with state law
State wage deduction laws often restrict how and when overpayments can be recovered, requiring employee notification and, in some states, written consent.
Which payroll record retention period is required by the FLSA for basic payroll records such as time cards and wage rate tables?
Answer: 2 years
The FLSA requires that records used to compute wages, such as time cards and piece-rate tables, be kept for at least 2 years.
An employee contributes to a Section 125 Cafeteria Plan. How does this affect their taxable wages?
Answer: Reduces federal, Social Security, and Medicare taxable wages
Section 125 pre-tax contributions reduce the employee's wages subject to federal income tax, Social Security, and Medicare taxes.
Which of the following is an example of a voluntary payroll deduction?
Answer: Employee 401(k) contribution
A 401(k) contribution is initiated at the employee's discretion, making it a voluntary deduction, unlike mandatory taxes.
A payroll system integration with an HR system of record is most valuable for:
Answer: Automatically syncing employee demographic and status changes to payroll
HR-to-payroll integration ensures that hires, terminations, pay changes, and demographic updates flow automatically, reducing manual data entry errors.
What does the term 'payroll cutoff date' refer to?
Answer: The deadline by which all payroll data must be submitted for processing before the pay date
The payroll cutoff date is the deadline for submitting time, expense, and change data so the payroll can be processed and funds disbursed on payday.
Under IRS rules, when must a new employee complete Form W-4?
Answer: Before or on their first day of work
The IRS requires employees to furnish a completed W-4 before or on their first day so that proper withholding can begin immediately.
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