Deck 16: Other Financial Systems

Question 1

Certified checks and money orders generally involve fees, whereas cashier's checks are issued free of charge.

Answer 1

False

Question 2

What percentage of financial transactions are handled by checks in a dental office?

A) 30%
B) 50%
C) 90%
D) 60%

Answer 2

90%

Question 3

The parts of a check include the following except the:

A) check number.
B) PIN number.
C) ABA bank number.
D) amount of the check.

Answer 3

PIN number.

Question 4

Which of the following forms must be given to each employee no later than January 31 of each year?

A) Federal Form #941
B) FUTA form
C) W-2 form
D) W-3 form
E) W-4 form

Question 5

An employer is required to have every employee complete an Employee's Withholding Allowance Certificate (Form W-4). This form determines the number of exemptions an employee will claim.

A) The first statement is true and the second statement is false.
B) The first statement is false and the second statement is true.
C) Both statements are true.
D) Both statements are false.

Question 6

A dental assistant earns $14 per hour. Based on a standard workweek of 40 hours with time and a half for overtime, her gross pay for working 45 hours is:

A) $455.
B) $630.
C) $665.
D) $945.

Question 7

Checks can be signed by the administrative assistant if this person's name is on a signature card required by the bank. In all cases, a power of attorney form must also be completed.

A) The first statement is true and the second statement is false.
B) The first statement is false and the second statement is true.
C) Both statements are true.
D) Both statements are false.

Question 8

A money order has the same function as a cashier's check in that it is a method of paying a creditor without the use of a personal check. A fee is charged for a money order but not for a cashier's check.

A) The first statement is true and the second statement is false.
B) The first statement is false and the second statement is true.
C) Both statements are true.
D) Both statements are false.

Question 9

An employer must keep all records pertaining to employment taxes available for inspection by the IRS. These records may be discarded after the federal income tax has been filed for that year.

A) The first statement is true and the second statement is false.
B) The first statement is false and the second statement is true.
C) Both statements are true.
D) Both statements are false.

Question 10

A dental assistant has gross weekly earnings of $560. The following amounts were withheld: $50 for federal taxes, $43 for FICA, and $50 for a deposit to the credit union. What is the net pay?

A) $417
B) $460
C) $467
D) $517

Question 11

The dentist's YTD earnings are $120,323. She earned $5000 this pay period. The FICA is calculated at 7.65%, which is split between Social Security at 6.2% on the first $76,200 earned in the year and the Medicare at 1.45% on all earnings, with no yearly cap. How much is withheld for the Medicare portion of the FICA?

A) $0
B) $7.25
C) $72.50
D) $725

Question 12

FUTA refers to the:

A) Federal Unemployment Trade Agreement.
B) Employers' Annual Federal Unemployment Tax Return.
C) Federal Universal Tax Agreement.

Question 13

As part of an accounts payable system, which record reflects all deposits and checks made from the account?

A) Payroll
B) Check register
C) Credit slip
D) Invoice

Question 14

To achieve an acceptable level of profit, what must be kept in balance with the expenditures?

A) Revenue
B) Checks
C) Profit
D) Loss

Question 15

A personal check that has a guarantee that the funds have been set aside by the bank for payment of the check is a:

A) cashier's check.
B) certified check.
C) money order.
D) traveler's check.

Question 16

A small fund of money kept in the office is known as:

A) voucher fund.
B) petty cash.
C) revenue.
D) bank draft.

Question 17

Reconciliation of a bank statement is typically done:

A) weekly.
B) monthly.
C) quarterly.
D) annually.

Question 18

The endorsement "For deposit in account of J.L. Lake" is referred to as a(n):

A) blank endorsement.
B) endorsement in full.
C) restrictive endorsement.

Question 19

Which of the following web sites can you consult to obtain information about an application for an Employer Identification Number?

A) "http://www.irs.gov/publications"
B) "http://www.ada.org"
C) "http://www.gov.org"

Question 20

Which of the following is an employer not required to withhold from an employee's payroll check?

A) FICA
B) Withholding
C) Local income tax where applicable
D) State income tax where applicable
E) Alimony

Question 21

Some administrative assistants may be given power of attorney that entitles them to sign checks for the practice.

Question 22

The employer has responsibilities for withholding, depositing, paying, and reporting federal income tax.

Question 23

Reconciling a bank account is balancing the bank statement with the check stub/check register balance.

Question 24

FICA taxes include Social Security and Medicare taxes.

Question 25

Net pay is the amount of earnings before deductions are taken.

Question 26

A bank draft is a check drawn by the cashier of one bank on another bank where it has available funds on deposit or credit.

Question 27

When writing a check, you do not need to enter the amount in words.

Question 28

The data that are magnetically encoded on the bottom of a check may include the American Bankers Association (ABA) identification number.

Question 29

A petty cash fund requires less accuracy than a checking account.

Question 30

A Federal Tax Deposit Coupon book (Form 8109) is used by an employer to transmit withheld income tax and FICA taxes to the federal depository.