Fundamental Payroll Certification (FPC) Practice Exam

Question: 1 / 400

What payroll method calculates net pay based on hours worked?

Salary Payroll

Commission Payroll

Hourly Payroll

The correct answer is based on the fact that hourly payroll calculates net pay based directly on the number of hours worked by the employee. In this payroll method, employees are paid a set rate for each hour they work. This means that the total earnings for the pay period are calculated by multiplying the hourly rate by the total hours worked, taking into account any overtime or other adjustments if necessary.

In contrast, salary payroll pays employees a fixed amount regardless of hours worked, which does not directly correlate to hours. Commission payroll compensates employees based on sales performance or revenue generated, while bonus payroll refers to one-time payments beyond regular wages, typically awarded for specific achievements or company performance. Understanding these distinctions helps clarify why hourly payroll specifically relies on the calculation of net pay based on hours worked.

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Bonus Payroll

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