Which of the Following Statements Regarding Compensation Is False

question 71

Multiple Choice

Which of the following statements regarding compensation is false?

• A)Wages are usually paid by the hour
• B)Salary is usually a form of fixed compensation
• C)Bonuses are a form of compensation obtained if certain criteria are met
• D)Bonuses paid within 2½ months of year end are included in employee's compensation in the year they were earned.Employees include compensation into income in the year received.

---

Definitions:

Form 1040

The conventional form from the Internal Revenue Service (IRS) employed by individuals to declare their annual income taxes.

Withholding Allowances

A number that employees claim on a W-4 form that determines the amount of money withheld from their paycheck for taxes.

Federal Income Tax

The tax levied by the U.S. federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.

Semimonthly

Occurring twice a month or every half month, often used in the context of payroll or billing periods.