Income & Deductions Study Guide

What is the purpose of the W-4 Form?

• To determine the amount of federal and state income tax to withhold from an employee's paycheck

• To report the total wages earned at the end of the year

• To establish minimum wages for employees

• To calculate overtime pay

What does the Fair Labor Standards Act establish?

• The process for filing taxes

• Minimum wages and overtime pay requirements

• The calculation of net pay

• The definition of salaried employees

What is the current minimum wage rate in New Jersey?

• $10.08 per hour

• $12.73 per hour

• $15.49 per hour

• $8.07 per hour

What is the definition of 'Net Pay'?

• Total pay before deductions

• Total pay after deductions

• Compensation based on sales

• Twice an employee’s hourly rate

What is 'Overtime'?

• Time worked during regular hours

• Time worked in excess of straight time

• Time worked on holidays

• Time worked at double pay

What is a Progressive Tax?

• A tax structure where the greater amount earned, the greater the tax.

• A tax structure where the tax rate decreases as income increases.

• A tax that remains the same regardless of income.

• A tax that only applies to luxury goods.

What is a Regressive Tax?

• A tax that increases as income increases.

• A tax that remains the same or decreases as income rises.

• A tax that only applies to imported goods.

• A tax that is only paid by corporations.

SUI is an example of what type of tax?

• Progressive tax

• Regressive tax

• Flat tax

• Luxury tax

FLI is an example of what type of tax?

• Progressive tax

• Regressive tax

• Flat tax

• Luxury tax

State income tax is an example of what type of tax?

• Progressive tax

• Regressive tax

• Flat tax

• Luxury tax