Chapter 12 Vocabulary

A qualified retirement plan sponsored by an employer. Fill in the blank: __________

• 401(k)

• Roth IRA

• Health Savings Account

• 529 Plan

The total gross earnings year to date for an employee. Fill in the blank: __________

• Accumulated earnings

• Net pay

• Withholding allowance

• Payroll period

The amount of total income minus adjustments, reported on Form 1040. Fill in the blank: __________

• Adjusted gross income

• Taxable income

• Gross income

• Net income

A method of paying an employee based on the amount of sales the employee generates. Commissions are normally calculated as a percent of an employee’s sales. Fill in the blank: __________

• Commission

• Salary

• Bonus

• Hourly wage

The payment of an employee’s net pay using electronic funds transfer. Fill in the blank: __________

• Direct deposit

• Payroll tax

• Overtime pay

• Manual check

A business form used to record details of an employee’s earnings and deductions. Fill in the blank: __________

• Employee earnings record

• Invoice

• Purchase order

• Bank statement

A qualified retirement plan that provides most individuals with a deferred federal income tax benefit. Fill in the blank: __________

• Individual retirement account (IRA)

• Health savings account (HSA)

• Certificate of deposit (CD)

• Roth 401(k)

A federal tax paid for hospital insurance. Fill in the blank: __________

• Medicare tax

• Social Security tax

• Income tax

• Property tax

Earnings paid to an employee after payroll taxes and other deductions. Fill in the blank: __________

• Net pay

• Gross pay

• Bonus

• Overtime

The number of days or weeks of work covered by an employee’s paycheck. Fill in the blank: __________

• Pay period

• Gross pay

• Net pay

• Deduction