Income and Taxes

The Fair Labor Standards Act_______.

• is used by the government to set the minimum wage.

• requires all states to have the same minimum wage.

• sets a limit as to how much one person can earn per year.

• None of these answers are correct.

Money added to an employee's base pay is a ________.

• tip

• commission

• bonus

• wage

A federal expense item that can be adjusted according to needs and revenues is a(n)

• direct tax

• indirect tax

• mandatory expenditure

• discretionary expenditure

Governments may use taxes to ______.

• fight inflation

• slow a recession

• promote economic stability

• all answers are correct

A tax, levied by federal and state governments on the sale and transfer of items like air travel, telephone services, and gasoline, is referred to as a(n) _______.

• wealth tax

• property tax

• excise tax

• sales tax

A newly hired employee will be asked to complete a ________.

• W4

• W2

• 1040

• 1040 EZ

A noncash compensation received in addition to a wage or salary is a(n) ______.

• employee benefit

• exemption

• bonus

• net pay

_____ refers to the amount of time an employee spends at work compared to the amount of time spent in personal life.

• Mandatory expenditure

• Voluntary compliance

• Overtime wage

• Work-life balance

The largest government entitlement program currently is _____.

• Social Security

• Medicare

• education

• deficit spending

The total income before payroll deductions is called_____.

• net pay

• adjusted gross income

• gross pay

• earned pay