The Three Main Tests Courts Use to Classify Employees and Independent

question 49

Multiple Choice

The three main tests courts use to classify employees and independent contracts are:

• A) the Master-servant rule, the Darden test, and the economic realities test.
• B) the Master-servant rule, the common-law agency test, and the GAP analysis.
• C) the common-law agency test, the Internal Revenue Service (IRS) 20-factor analysis, and the economic realities test.
• D) the Internal Revenue Service (IRS) 20-factor analysis, Myers Briggs test, and earned value analysis.

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Definitions:

Deferred Taxes

Taxes that are assessed or levied for one period but deferred to a future period for payment.

Consolidated Balance Sheet

A financial statement that combines the assets, liabilities, and equity of a parent company and its subsidiaries into one document to provide a comprehensive overview of the financial position of the entire group.

Tax Rate

The percentage rate at which an individual or corporation is taxed.

Gross Profit

The difference between revenue and the cost of goods sold before administrative and other expenses are deducted.