Which of the Following Statements Best Describes a Merit Raise

question 15

Multiple Choice

Which of the following statements best describes a merit raise?

• A) A promise of future payments
• B) A permanent pay raise that recognizes past performance
• C) An increase that is tax exempt
• D) A lump sum reward for past performance that does not increase base pay

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Definitions:

Straight-line Method

A method of calculating depreciation of an asset where the cost is evenly allocated over its useful life, resulting in a consistent expense each period.

Accounting Standards

Rules and guidelines set by authoritative bodies that dictate how financial transactions and statements should be reported and maintained.

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Subsidiary

A company that is completely or partly owned and partly or wholly controlled by another company, known as the parent company.