Payroll & Purchasing Skills & Knowledge Test
This Payroll & Purchasing Skills & Knowledge Test evaluates essential competencies in managing payroll and purchasing transactions. It covers calculations of hourly wages, annual salaries, overtime, and cost analysis, crucial for finance and HR professionals.
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- 2.
If a full time hourly is paid $10 per hour, what is their annual salary?
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$19,200
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$22,100
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$18,500
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$20,800
Correct Answer
A. $20,800Explanation
A full-time employee by definition works 40 hours per week, so they make $400 each week ($10/hr x 40 hrs/week). There are 52 weeks in a year, so the employee makes $20,800 per year ($400/week x 52 weeks/year).
The quickest way to calculate this is the take the hourly rate and multiply it by 2080 (40hrs/week x 52 weeks/year = 2080 hrs/year).Rate this question:
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- 3.
If a salaried employee makes $31,200 per year, what is their hourly rate equivalent?
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$15.00/hr
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$16.25/hr
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$13.00/hr
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$14.75/hr
Correct Answer
A. $15.00/hrExplanation
A salared employee by definition works 40 hours per week, so to calculate their hourly rate you divide their annual salary by 2080 (40 hrs/wk x 52 wks/yr = 2080 hrs/yr).Rate this question:
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- 4.
When does an employee receive overtime pay?
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When they have more than 40 hours of paid time in a week, including paid time off.
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When they physically work more than 40 hours per week.
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When their manager wants them to receive overtime pay.
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When they work more than 8 hours in a day.
Correct Answer
A. When they physically work more than 40 hours per week.Explanation
An employee receives overtime pay when they physically work more than 40 hours per week. This means that if an employee works more than 40 hours in a given week, they are entitled to receive additional compensation for the extra hours worked. This is a common practice in many industries and is often required by labor laws to ensure fair compensation for employees who work longer hours.Rate this question:
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- 5.
If an employee works from 1:00 pm to 3:30 pm, how many hours did they work?
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2.50 hours
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2.25 hours
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3.30 hours
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2.30 hours
Correct Answer
A. 2.50 hoursExplanation
The employee worked from 1:00 pm to 3:30 pm, which is a total duration of 2 hours and 30 minutes. Since there are 60 minutes in an hour, 30 minutes is equivalent to 0.5 hours. Therefore, the employee worked for 2 hours and 0.5 hours, which adds up to 2.50 hours.Rate this question:
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- 6.
A vendor offers the same pens for sale at either $5.00 for a dozen or $12.00 for three dozen. Which is the better deal?
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$5.00 for a dozen
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$12.00 for three dozen
Correct Answer
A. $12.00 for three dozenExplanation
The better deal is $12.00 for three dozen pens. By dividing $12.00 by three, we can find the cost per dozen, which is $4.00. This means that each dozen of pens costs $4.00, which is cheaper than the $5.00 for a dozen option. Therefore, purchasing three dozen pens for $12.00 is a better deal than buying one dozen for $5.00.Rate this question:
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- 7.
We get a new job for consumers gluing together flower barrettes. An average, non-disabled worker can glue 500 pieces in an hour and makes $10 per hour. How much do we need to pay consumers for each piece they glue?
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$0.20
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$0.05
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$0.02
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$0.50
Correct Answer
A. $0.02Explanation
An average, non-disabled worker can glue 500 pieces in an hour and makes $10 per hour. To find out how much we need to pay consumers for each piece they glue, we divide the total amount earned ($10) by the total number of pieces glued (500). The result is $0.02 per piece, which is the correct answer.Rate this question:
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- 8.
An SCD employee earns $9.00 per hour, and also receives a supplemental $3.50 per hour in Health & Welfare benefits. If the employee works 35 hours in a week, what is their gross pay for that week?
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$315.00
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$437.50
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$350.00
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$450.50
Correct Answer
A. $437.50Explanation
The SCD employee earns $9.00 per hour and receives an additional $3.50 per hour in Health & Welfare benefits. To calculate their gross pay for the week, we multiply the total number of hours worked (35) by the sum of their hourly wage and the Health & Welfare benefits: ($9.00 + $3.50) * 35 = $437.50. Therefore, the correct answer is $437.50.Rate this question:
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- 9.
A full-time hourly employee has a pay rate of $10.00/hr. If they work 50 hours in a week, what is their gross pay for that week?
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$500.00
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$550.00
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$400.00
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$450.00
Correct Answer
A. $550.00Explanation
The correct answer is $550.00. To calculate the gross pay, we multiply the pay rate ($10.00/hr) by the number of hours worked (50 hours). Therefore, $10.00/hr * 50 hours = $500.00.Rate this question:
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- 10.
What is the current federal minimum wage?
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$7.50/hr
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$7.25/hr
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$5.35/hr
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$9.00/hr
Correct Answer
A. $7.25/hrExplanation
The current federal minimum wage in the United States is $7.25 per hour. This is the minimum hourly wage that employers are required to pay their employees by law. It is important to note that individual states may have their own minimum wage laws, which could be higher than the federal minimum wage. However, the federal minimum wage serves as the baseline standard for minimum wage across the country.Rate this question:
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- 11.
Employers are required to pay Social Security & Medicare taxes on wages paid to employees in addition to the the Social Security & Medicare taxes they deduct rom their employee's paychecks.
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True
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False
Correct Answer
A. TrueExplanation
Employers are indeed required to pay Social Security and Medicare taxes on wages paid to employees. This is in addition to the taxes they deduct from their employee's paychecks. These taxes are used to fund the Social Security and Medicare programs, which provide benefits to retired individuals and those with disabilities, as well as healthcare coverage for individuals over the age of 65. Therefore, it is true that employers have the responsibility to pay these taxes on behalf of their employees.Rate this question:
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- 12.
Supplemental wages paid to employees, such as bonuses and commissions, are not taxable.
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True
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False
Correct Answer
A. FalseExplanation
Supplemental wages paid to employees, such as bonuses and commissions, are indeed taxable. These wages are considered as income and are subject to federal income tax, as well as other applicable taxes such as Social Security and Medicare. The employer is required to withhold the appropriate amount of taxes from these supplemental wages and report them to the tax authorities. Therefore, the statement that supplemental wages are not taxable is incorrect.Rate this question:
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- 13.
What should you do if an employee wants requests a purchase totaling $550, but their spending limit is $50?
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Obtain approval from someone above the employee that has a spending limit greater than $500.00.
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Split the order into two separate orders for $225 each.
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Place the order anyway, because $50 is immaterial.
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Tell the employee they can't place that order and they are out of luck.
Correct Answer
A. Obtain approval from someone above the employee that has a spending limit greater than $500.00.Explanation
If an employee wants to request a purchase totaling $550, but their spending limit is only $50, the appropriate action would be to obtain approval from someone above the employee who has a spending limit greater than $500. This ensures that the purchase is authorized by someone with the authority to make decisions regarding larger expenses. Splitting the order into two separate orders or placing the order anyway would not address the issue of exceeding the spending limit. Telling the employee they can't place the order and they are out of luck would not be a productive or fair response.Rate this question:
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- 14.
Which of these job duties are the responsibility of purchasing? (multiple answers)
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Placing orders requested by company employees
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Checking options to make sure we are receiving the best price available for all products that we order.
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Create Purchase Orders in the accounting software to serve as documentation that the order was placed when the invoice arrives.
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Process invoices through QuickBooks after the product is received.
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Follow up on the status of back orders
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Research discrepancies between the price a vendor quoted us when we made a purchase and the price they charged us when they sent the invoice.
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Cut checks to vendors.
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Go to the store to pick up items that employees request be purchased.
Correct Answer(s)
A. Placing orders requested by company employees
A. Checking options to make sure we are receiving the best price available for all products that we order.
A. Create Purchase Orders in the accounting software to serve as documentation that the order was placed when the invoice arrives.
A. Follow up on the status of back orders
A. Research discrepancies between the price a vendor quoted us when we made a purchase and the price they charged us when they sent the invoice.Explanation
The responsibilities of purchasing include placing orders requested by company employees, checking options to ensure the best price for products, creating purchase orders for documentation, following up on back orders, and researching discrepancies in pricing between quotes and invoices. These tasks involve the procurement process and ensuring efficient and cost-effective purchases for the company.Rate this question:
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- 15.
An hourly employee who currently makes $10.00/hr receives a 5% pay raise. What is their new hourly rate?
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$10.05/hr
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$10.50/hr
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$15.00/hr
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$11.00/hr
Correct Answer
A. $10.50/hrExplanation
The employee receives a 5% pay raise, which means their hourly rate will increase by 5% of $10.00. To calculate this, we multiply $10.00 by 5% (0.05). The result is $0.50. Adding this to the original hourly rate of $10.00 gives us the new hourly rate of $10.50.Rate this question:
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- 16.
We want to purchase a new laptop. At Best Buy, the laptop costs $550 and shipping is a flat $35 per order. At New Egg, the laptop costs $575, and shipping general costs $20 per order, but New Egg will waive the shipping charges for orders over $300. Which is the better deal?
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Best Buy
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New Egg
Correct Answer
A. New EggExplanation
New Egg is the better deal because even though the laptop itself is slightly more expensive, they waive the shipping charges for orders over $300. Since the laptop costs $575, which is over $300, there will be no shipping charges at New Egg. On the other hand, at Best Buy, the laptop costs $550 and there is a flat shipping fee of $35 per order. Therefore, the total cost at New Egg will be lower than at Best Buy.Rate this question:
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- 17.
Sam is one of our employees. On payday, his wife calls and asks what his net pay was so she can balance her checkbook. Is it ok to tell his wife what he made?
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Yes
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No
Correct Answer
A. NoExplanation
It is not okay to tell Sam's wife what he made on payday because salary information is considered personal and confidential. Sharing this information without Sam's consent would be a violation of his privacy.Rate this question:
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- 18.
Human Resources lets you know that one of the sales reps is being terminated on Friday for failing to meet sales quotas so that you can make sure their payroll access is turned off prompty. Who should you share this information with?
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No one.
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The Accounts Payable person, so she can disable the sales rep's credit card
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One of your coworkers who you trust to keep a secret.
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The other sales reps so they know what is going to happen.
Correct Answer
A. No one.Explanation
The correct answer is "No one." Sharing this information with anyone could potentially violate the terminated employee's privacy rights and could also lead to unnecessary gossip or speculation among coworkers. It is best to keep this information confidential and only share it with those who have a legitimate need to know, such as the HR department or the person responsible for disabling the sales rep's payroll access.Rate this question:
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Current Version
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Mar 22, 2023Quiz Edited by
ProProfs Editorial Team -
Sep 07, 2012Quiz Created by
OEEnterprises
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