CPP Practice Exam 2

25 Questions | Total Attempts: 3850

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CPP Quizzes & Trivia

This is a practice quiz to help you prepare for the Certified Payroll Professional certification. The quiz is based on a bank of 25 multiple choice questions that reveal the correct answer before you move on to the next question. The questions and their associated answers are randomized every time you take the quiz to avoid pattern development. Questions requiring calculations that change from year to year have been omitted. Good luck as you pursue this goal. I hope this helps you prepare. Inspired by my lovely wife as she pursued this goal as well.


Questions and Answers
  • 1. 
    Which of the following is one of the purposes of a job description?
    • A. 

      Defining the company policy on paying overtime

    • B. 

      Setting expectations for work to be performed

    • C. 

      Describing benefits for which the incumbent is eligible

    • D. 

      Outlining the company's position on job cost accounting

  • 2. 
    Which of the following forms must the employer receive as authorization to discontinue withholding under a federal tax levy notice?
    • A. 

      668-W(c)

    • B. 

      I-9

    • C. 

      668-D

    • D. 

      2678

  • 3. 
    The penalty for failure to withhold wages under a federal tax levy notice is:
    • A. 

      150% of the amount not withheld

    • B. 

      100% of the amount not withheld

    • C. 

      50% of the amount not withheld

    • D. 

      75% of the amount not withheld

  • 4. 
    In a leasing arrangement, which of the following is not assumed by the leasing company?
    • A. 

      Hiring of employees

    • B. 

      Termination of employees

    • C. 

      Payment of employees

    • D. 

      Product research

  • 5. 
    An employer may accept a child support order directly served from another state without risk of liability under which of the following laws?
    • A. 

      URESA

    • B. 

      UIFSA

    • C. 

      ERISA

    • D. 

      OCSE

  • 6. 
    Portability describes the attribute of software to:
    • A. 

      Print output in duplex

    • B. 

      Execute on other platforms without application code modifications

    • C. 

      Use telephone lines to communicate between physical locations

    • D. 

      Use video and audio

  • 7. 
    Under IRS suggested guidelines, an employee should be allowed a maximum of how many days after receiving an expense advance to provide substantiation for the amount to the employer?
    • A. 

      30 days

    • B. 

      45 days

    • C. 

      60 days

    • D. 

      90 days

  • 8. 
    Which of the following would NOT be defined as a tax-deferred benefit?
    • A. 

      401(k) pretax contributions

    • B. 

      125 pretax contributions

    • C. 

      403(b) pretax contributions

    • D. 

      Non qualified plan contributions

  • 9. 
    FLSA coverage does not apply under which of the following conditions?
    • A. 

      All employees are part time workers

    • B. 

      Employees are paid $2.13 per hour

    • C. 

      Employer and employees are not engaged in interstate commerce

    • D. 

      Employees are minors under the age of 18

  • 10. 
    Chicken Licken requires that all employees wear uniforms that are unique to chicken Licken restaurants.  New employees are required to pay $40 for their uniforms from their first regular paycheck.  Assume that it is September 2009, and one of tis new employees earns $8.20 per hour and works 42 hours in the first workweek ending September 18.  What is the maximum that Chicken Licken can deduct from this employees wages for the uniform?
    • A. 

      $0

    • B. 

      $39.90

    • C. 

      $48.10

    • D. 

      $38.00

  • 11. 
    Which fo the following accoutns has a normal debit balance?
    • A. 

      Liability

    • B. 

      Revenue

    • C. 

      Equity

    • D. 

      Expense

  • 12. 
    Bass Biting Company operates a bait, tackle and boat sales store employing 12 full time clerks and salespeople in addition to the owner and his family members.  Occasionally, Bass Biting assigns special work to individuals other than it's regular employees and family members.  Only two employees, George the President, and Earl, a salesperson, receive group-term life insurance.  The value of each of their group-term life benefit is $93 per month, and $23 per month after excluding the first $50,000 of coverage.  How much is exempt from wages?
    • A. 

      $93.00

    • B. 

      $186.00

    • C. 

      $46.00

    • D. 

      $0

  • 13. 
    Bass Biting Company operates a bait, tackle and boat sales store employing 12 full time clerks and salespeople in addition to the owner and his family members.  Occasionally, Bass Biting assigns special work to individuals other than it's regular employees and family members.  Bass Biting engaged a carpenter, Jim to build a boat dock so that customers could access the shop via boat.  Jim has several docks in progress for other local merchants.  Bass Biting's dock took 4 days to build, 13 hours each day.  Bass Biting paid Jim $500 for 4 days' work.  Calculate overtime due Jim under FLSA.
    • A. 

      $173.04

    • B. 

      $557.44

    • C. 

      $57.72

    • D. 

      $0

  • 14. 
    Bass Biting Company operates a bait, tackle and boat sales store employing 12 full time clerks and salespeople in addition to the owner and his family members.  Occasionally, Bass Biting assigns special work to individuals other than it's regular employees and family members.  Employee Lois was a bait and tackle shop clerk until she retired on June 30.  Lois returned to the bait and tackle shop to perform clerical duties on August 15 and worked through Labor Day to assist Bass Bititng through its busy season.  Determine Lois' employment status with Bass Biting
    • A. 

      Nonstaturory employee

    • B. 

      Independent contractor

    • C. 

      Statutory nonemployee

    • D. 

      Employee

  • 15. 
    Employee data need not be entered in both the payroll system and the time and attendance system when which of the following is used?
    • A. 

      A password

    • B. 

      An interface

    • C. 

      A firewall

    • D. 

      Open systems

  • 16. 
    Under the FLSA, employees working in the New England states for a product distributor are entitled to which of the following overtime pay benefits?
    • A. 

      Overtime is paid for all hours worked over 8 per day

    • B. 

      Overtime is paid for hours worked over 40 in a work week

    • C. 

      Compensatory pay is allowed for hours over 80 in a biweekly pay period

    • D. 

      Double time is paid for work on holidays

  • 17. 
    Which of the following supports payroll system security?
    • A. 

      Constructive receipt

    • B. 

      Labor law compliance

    • C. 

      New hire reporting

    • D. 

      Audit trails

  • 18. 
    Which of the following is an example of a system edit?
    • A. 

      Firewalls are in place to guard against unauthorized Internet users

    • B. 

      A pop-up message alerts the user that a date entered is invalid

    • C. 

      Step-by-step procedures are followed by the payroll specialist

    • D. 

      The system has a batch report writer

  • 19. 
    The primary responsibility of Professional Employer Organizations is:
    • A. 

      Establishing their client's FEIN

    • B. 

      Co-employment of their client's employees

    • C. 

      Leasing the buildings and fixtures

    • D. 

      Determining the client's products and services

  • 20. 
    Josh, a nonexempt accounting specialist, is assigned to a normal work schedule of 40 hours a week, 8:00 a.m. to 5:00 p.m. each day, with one hour for lunch.  On Monday, Josh travels by train from Boston to a business meeting in his company's Phhilidelphia office.  The train leaves at 8:00 a.m. and arrives in time for Josh to attend the afternoon meeting, which concludes at 5:30 p.m.  He then returns to Boston on a train that leaves at 7:00 p.m.  If Josh does not miss any work the rest of the week, what hours for Monday may be subject to overtime?
    • A. 

      None

    • B. 

      8.5 hours

    • C. 

      0.5 hours

    • D. 

      2.0 hours

  • 21. 
    Which of the following sets of data should be maintained on the payroll master file?
    • A. 

      Employer's date of incorporation

    • B. 

      Name and address of benefits provider

    • C. 

      Deductions made to satisfy an IRS levy

    • D. 

      Employee's prior employment history

  • 22. 
    Which of the following employees is most likely to be an exempt professional under FLSA?
    • A. 

      Labor Relations Director

    • B. 

      Payroll specialist

    • C. 

      Human resources receptionist

    • D. 

      Accounts payable clerk

  • 23. 
    Which of the following accounts has a normal credit balance?
    • A. 

      Asset

    • B. 

      Liability

    • C. 

      Expense

    • D. 

      Cash

  • 24. 
    Which of the following would not be included in the Needs Analysis stage of a system evaluation?
    • A. 

      Review of the current system

    • B. 

      System testing

    • C. 

      Creating a current cost model

    • D. 

      Defining the company's technical direction

  • 25. 
    Which of the following general ledger accounts is integral to a quarterly deposit reconcilitation?
    • A. 

      Payroll cash

    • B. 

      Salary cash

    • C. 

      Accrued wages payable

    • D. 

      Tax liabilities