PAYROLL MIDTERM EXAM PROCESSING PRL 2 LATEST 2024 VERSION EXAM QUESTIONS WITH ANSWERS, Exams of Payment Systems

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PAYROLL MIDTERM EXAM

PROCESSING PRL 2

LATEST 2024 VERSION

EXAM QUESTIONS WITH

ANSWERS

Mid-Term Exam

(1) All new employees have to complete the Federal Personal Tax Credits Return TD1 even if they are only claiming the basic exemption? a. True b. False

2. (1) Name the one group sickness and accident insurance plan that is a non- cash taxable benefit in all provinces and territories? a. Short-term disability b. Long-term disability c. Accident insurance plans d. All of the above 3. (1) British Columbia funds its health care through premiums collected from the of the province. a. Employees b. Employers c. Residents d. All of the above 4. (1) If you are calculating the C/QPP contributions on a non-regular payment, that is being paid separately from the employee’s regular salary or wages, the pay period exemption has to be applied to the payment a. True b. False

10.(1) The TD1-WS is used to calculate partial claim amounts for a. Infirm dependent age 18 or older b. Age c. Caregiver d. All of the above 11.(1) List the four categories of employment income.

**- Earnings

• Allowance
• Benefits
• Taxable expense reimbursements 12.(1)** List the four main pay period frequencies and how many in a year Weekly – 52 pay periods Bi-weekly – 26 pay periods Monthly – 12 pay periods Semi-monthly – 24 pay periods 13.(1) It is possible to have a year with more than 52 or 26 pay periods a. True b. False

14.(1) Match the types with the descriptions. Put the correct letter in the middle column Type Description Retroactive increase (^) B a. A type of earning required when an increase in wages is processed after the increase has been awarded, for example, where the paperwork authorizing the increase is late in coming Bonus C b. A type of earning required when an increase in wages is awarded and the effective date is backdated, for example, where the signing of a new contract occurs after the expiry day of the old contract Retroactive adjustment A c. A non-regular payment made to an employee, over and above regular wages, in recognition for a job well done 15.(1) Which provinces impose a tax on insurance premiums? A Retail Sales Tax of 8% on insurance premiums are assessed on the provinces of Manitoba and Ontario assess, the province of Québec assesses a 9% tax on insurance premiums, and the province of Saskatchewan assesses a 6% Provincial Sales Tax on insurance premiums. 16.(2) On the following chart to specify if the items are taxable or non-taxable, federally and in Quebec. If taxable, what amount would it be? AN EMPLOYEE RECEIVES: Federally Quebec

3 rd^ Quarter – 4 % 4 th^ Quarter – 3 % Calculate what Nancy’s monthly taxable benefit and her total benefit for the year are: Pay Period Loan Balance Government prescribed interest rate Organization Interest Rate Monthly taxable benefit (annual / 12) January (^) 15000 3% 2% 12. February 14250 3% 2%

March 13500 3% 2%

April 12750 2% 2%

May 12000 2% 2%

June 11250 2% 2%

July 10500 4% 2%

August 9750 4% 2%

September 9000 4% 2%

October 8250 3% 2%

November 7500 3% 2%

December 6750 3% 2%

Total taxable benefit for the year 103. 18.(3) Julie is an employee working in Alberta, she is paid $17.50 an hour. She is paid 1.5 times her regular rate for any overtime hours. Julie pays $15.00 union dues each month. She also contributes 3% of her regular pay to an RRSP each pay period. She worked her regular 80 hours bi-weekly plus 8 hours of overtime. Her Federal claim code is 2 and her Provincial claim is 3 Calculate Julie’s bi-weekly net pay showing all calculations

Regular Pay 17.5 1400 80 hours x $17. OT Pay 26.25 157.5 6 hours x (17.50 x 1.5) Union Dues per pay 15 6.923077 ($15 / month x 12) / 26 RRSP Contribution $42.00 $1400.00 x 0. GE 1557.5 1400.00 + 157. NTCB 0 CPP exemption 134.61 3500 / 26 = 134. Contributory Earnings 1422.89 1557.50 - 134.

CPP 3 1422.89 x 0. GIE 24.6085 1557.50 x 0. NTI $1,508. GPTI - approved deductions 8 1557.50-6.92-62. Federal Tax Code 2 144. Provincial Tax Code 3 65 Total Income Tax 209.

Total Deduction 3 CPP 24.6085 EI 209.3 Income Tax

7 Union Dues $42.00 RRSP

3 Total Deductions

Net Pay 7 1557.50-357.

19. (3) Natasha is an employee in Quebec who earns $30,000 salary per year and is paid semi-monthly. She pays monthly union dues of $50.00.

15 EI 6.175 QPIP 255.3 Federal Tax 466.99 Quebec Tax 20 Union Dues 75.21 Group Life Benefit 903.756 Total Deductions Net Pay 346.