FM Unit 6 Test Review

Front

What is the formula to calculate Social Security tax?

Back

Social Security Tax = Annual Salary x 6.2%

Front

What are Elective Benefits?

Back

Benefits that the government does NOT require, such as sick pay, vacation pay, medical and dental insurance, and retirement savings plans.

Front

What is Total Compensation?

Back

Total Compensation = Wages + Benefits

Front

What is a deductible in insurance?

Back

The amount you have to pay before the insurance company will pay your claim.

Front

What are Statutory Benefits?

Back

Government mandated benefits that must be provided to workers.

Front

How do you calculate the Social Security tax for an annual salary of $175,000?

Back

Social Security Tax = $175,000 x 6.2% = $9114.00

Front

What is the difference between Elective Benefits and Statutory Benefits?

Back

Elective Benefits are optional and not required by law, while Statutory Benefits are mandated by the government.

Front

What is the purpose of Social Security?

Back

To provide financial support to individuals during retirement, disability, or death.

Front

What is Medicare?

Back

A federal health insurance program for people aged 65 and older, and for some younger people with disabilities.

Front

What is the significance of understanding Total Compensation?

Back

It helps employees understand the full value of their employment package, including wages and benefits.