Regarding Net Pay,which of the Following Statements Is Incorrect

question 45

Multiple Choice

Regarding net pay,which of the following statements is incorrect?

• A) The net pay amount is not important for accounting purposes.
• B) The amount of compensation that the employee actually takes home is net pay.
• C) The employer either writes a paycheck to each employee for his or her net pay or directly deposits the employee's net pay into the employee's bank account.
• D) Net pay equals gross pay minus all deductions.

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Definitions:

Yield to Maturity

The total return anticipated on a bond if the bond is held until it matures, including all interest payments and the repayment of principal.

Real Rates

The interest rate after adjusting for inflation, reflecting the real cost of borrowing and the real yield to investors.

Coupon

The interest rate stated on a bond when issued, which is paid by the issuer to the bondholder at specified intervals.

Indenture

A formal legal agreement, contract, or document, especially one outlining the terms of a bond or trust.