Multiple Choice
A set income given to an employee on a weekly or monthly basis is known as:
18
views
9. Current Liabilities
Payroll and Payroll Taxes
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Which of the following statements about involuntary deductions from an employee's gross pay is correct?
A
They are optional and chosen by the employee.
B
They are not reported on the employee's pay stub.
C
They are withheld by the employer and remitted to third parties such as government agencies.
D
They are paid directly to the employer as additional compensation.
Verified step by step guidance1
Understand the concept of involuntary deductions: These are amounts withheld from an employee's gross pay by the employer, as required by law or court orders, and are not optional.
Identify examples of involuntary deductions: Common examples include federal and state income taxes, Social Security taxes, Medicare taxes, and court-ordered garnishments.
Clarify the reporting process: Involuntary deductions are typically reported on the employee's pay stub to ensure transparency and compliance with legal requirements.
Explain the remittance process: Employers are responsible for withholding these amounts and remitting them to third parties, such as government agencies or courts, on behalf of the employee.
Eliminate incorrect options: Review the provided statements and rule out those that contradict the definition and process of involuntary deductions, leaving the correct answer as the one that aligns with the explanation above.
Related Videos
Related Practice
Payroll and Payroll Taxes practice set
Problem sets built by lead tutorsExpert video explanations