Chap 1 Problem Set B

Question 1

Pros of outsourcing payroll…

which apply?

• decreased responsibility for payroll accuracy
• guaranteed reduction in time associated with payroll processing
• flexibility
• compliance with complicated payroll regulations
• advanced data analysis
• assistance with strategic planning

Answer 1

• flexibility
• compliance with complicated payroll regulations
• advanced data analysis
• assistance with strategic planning

Question 2

Cons of outsourcing payroll…

which apply?

• lack of control over payroll records
• costs may outweigh benefits received
• reliance on another party to maintain confidentiality of the records
• compliance with tax laws

Answer 2

• costs may outweigh benefits received
• reliance on another party to maintain confidentiality of the records
• compliance with tax laws

Question 3

Jolana Thomas is the payroll clerk for Telemba Communications. One of the company’s employees, Darijo Boon, informs Jolana that he feels that he was the victim of unequal pay three years prior. What law(s) provide guidance about Darijo’s complaint?

Which apply?

• FLSA
• Civil Rights Act of 1964
• Equal Pay Act
• Judiciary Act

Answer 3

• FLSA
• Civil Rights Act of 1964
• Equal Pay Act

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Question 4

Clara Hudnall is Conosis Incorporated’s payroll accountant. During a casual conversation with co-workers, she learns that Thorben Vinkovic, a co-worker, is deliberately overstating the number of hours worked during each pay period because of a personal economic situation. Which ethical guidelines pertain to this situation?

Which apply?

• Professional competence and due care in the proper preparation of the payroll
  and verify externally with the supervisor or manager the actual hours worked.
• Encourage the employee to continue taking care of family needs as they have been.
• A lack of Integrity could make her an accomplice by allowing the transactions to continue overstated.
• Professionalism to the company and ensuring that there is honest and true representation to the costs of the business.

Answer 4

• Professional competence and due care in the proper preparation of the payroll and verify externally with the supervisor or manager the actual hours worked.

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• A lack of Integrity could make her an accomplice by allowing the transactions to continue overstated.
• Professionalism to the company and ensuring that there is honest and true representation to the costs of the business.

Question 5

Perpetua Holguin is a payroll accountant for Marore Industries. She is asked to explain the differences between manual and computerized accounting practices. What differences should she highlight in her explanation?

Which apply?

• Computerized accounting never requires additional hardware to complete necessary tasks.
• A computerized system can improve accuracy and timeliness as the payroll timekeeping systems can be programmed to interface with the company’s accounting programs.
• Manual systems require the timekeeping and calculations to be completed by an individual with the assistance with limited technology.
• Manual payroll accounting is more expensive than computerized accounting

Answer 5

• A computerized system can improve accuracy and timeliness as the payroll timekeeping systems can be programmed to interface with the company’s accounting programs.
• Manual systems require the timekeeping and calculations to be completed by an individual with the assistance with limited technology.

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Question 6

During a review of payroll records, Osvaldo Morena notices that a female employee in Department A is receiving a significantly lower salary than similarly skilled male employees in the same department. What actions should Osvaldo take in this situation?

Which apply?

• Inform the employee about the pay discrepancy.
• Go to the supervisor of the individual spoken to previously.
• If all channels fail, then she may have a claim under the Equal Pay Act with or without the extension provided by the Lilly Ledbetter Fair Pay Act of 2009.
• Publish her findings in the next company newsletter.
• Go to the manager or supervisor to discuss these differentials.
• Gather the information that shows the differences in pay based on sex of the employee.

Answer 6

• Go to the supervisor of the individual spoken to previously.
• If all channels fail, then she may have a claim under the Equal Pay Act with or without the extension provided by the Lilly Ledbetter Fair Pay Act of 2009.
• Go to the manager or supervisor to discuss these differentials.
• Gather the information that shows the differences in pay based on sex of the employee.

Question 7

Samuel Alescio is an accountant for Diado, a large, multinational firm. During payroll processing, he notices that the new state payroll tax updates have not been installed in the firm’s software. What ethical guidelines govern his behavior in this situation?

Which apply?

• Ensure the tax withholding and remittance are correct with the new state payroll rates.
• Avoid professional conferences that may cause confusion to his skills.
• Use the existing software without updates to avoid disruptions in payroll distribution.
• Notify his supervisor of the discrepancy.

Answer 7

• Ensure the tax withholding and remittance are correct with the new state payroll rates.
• Notify his supervisor of the discrepancy.

Question 8

Nitza Croce is an employee of Autonder, a contractor that provides governmental construction services in Washington, DC. The current contract is for $250,000. Nitza is 22 and is paid $9.50 per hour. How does the Walsh–Healey Public Contracts Act affect her?

Which apply?

• Would fall under Walsh-Healey Public Contracts Act.
• Would require minimum wage for all hours worked under 40 per week.
• Would automatically be classified as exempt from FLSA regulations.
• Wages at 1.5 times the regular hourly wage for those worked over 40 hours per week.

Answer 8

• Would fall under Walsh-Healey Public Contracts Act.
• Would require minimum wage for all hours worked under 40 per week.
• Wages at 1.5 times the regular hourly wage for those worked over 40 hours per week.

Question 9

Eugene Robertson works as a payroll clerk at Hyperend Incorporated. He shares an office with three other co-workers and must examine documents containing personal information as a regular part of his duties. Based on the provisions of the Privacy Act of 1974, what responsibilities does Eugene have regarding the payroll records he handles?

Which apply?

• Eugene is responsible for keeping employee information such as addresses, dependents, compensation, payroll deductions, social security number or garnishment information.
• Record payroll-related security measures (i.e., passwords, keys, etc.) for location by other employees.
• Eugene must ensure that he does not leave any sensitive information as
  disclosed by the Privacy Act of 1974 where individuals can access them.

Answer 9

• Eugene is responsible for keeping employee information such as addresses, dependents, compensation, payroll deductions, social security number or garnishment information.
• Eugene must ensure that he does not leave any sensitive information as
  disclosed by the Privacy Act of 1974 where individuals can access them.

Question 10

Larissa Abiodun is a senior payroll administrator for Falcive Landscape Design. The company has 15 employees and annual revenues of $10 million. She has been using and maintaining manual payroll records for the last 20 years of her career, and the president of Falcive Landscape Design wants to explore options for computerized payroll processing. Which payroll option is the most suitable for both Larissa and Falcive Landscape Design?

Which apply?

• Quicken
• Sage 100cloud
• QuickBooks
• Access Accounting
• Microsoft Excel

Answer 10

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• Sage 100cloud
• QuickBooks

(Given the size of the company, a computerized accounting system – QuickBooks or Sage 100cloud – would be good options for internal processing of the company’s payroll.)

Question 11

Alfredo Bellini is the payroll accountant for Pyrondo Fireworks and he has been asked for information about employees and independent contractors. What are the key differences between employees and independent contractors?

Which apply?

• Number of hours worked
• Control the company has over the employee
• Educational level
• The extent the employee’s work
• Investment
• Decisions
• Management
• Ownership of any tools

Answer 11

• Control the company has over the employee
• The extent the employee’s work
• Investment
• Decisions
• Management
• Ownership of any tools