Which of the following is true about fringe benefits? Which of the following is true about...

Which of the following is true about fringe benefits?

They represent additional compensation given for services performed
They are only available for employees.
The amount of the fringe benefit is never subject to income tax.
They represent additional cash paid directly to employees.

Expert Solution

Correct Answer:

Option(2) or fringe benefits are only available for employees is correct answer because the fringe benefits are the befits given to employees apart from their salary or wages such as medical insurance,Company Car,educational allowance, housing allowance and so on. So they are given to only the employees of the organizations.

Incorrect answers:

Option(1) is incorrect answer because fringe benefits are not the additional compensation given for services performed.But they are paid outside the compensations such as medical insurance, educational allowance, housing allowance and so on.

Option(3) is incorrect answer because certain fringe benefits are subject to income tax.Generally 30% tax rate is charged on fringe benefits.

Option(4) is incorrect answer because it does not include the additional cash paid to directly to employees.These fringe benefits are paid to employees in non cash form.

So correct answer is option(2)

ekkarill92 answered 2 years ago

Which of the following is true about disability insurance? It benefits the disabled employee only for...

Which of the following is true about disability insurance? It benefits the disabled employee only for the first year of disability. Payments under short-term plans are less than that of long-term plans. It pays about 50% to 70% of the employee's salary in case of disability. Most employers offer long-term disability plans. It offers coverage when the employee's dependent is disabled.

Determine whether or not the following benefits are fringe benefits. Provide your reasoning with any relevant...

Determine whether or not the following benefits are fringe benefits. Provide your reasoning with any relevant reference(s). A cancellation fee paid by an employee to the travel agent in relation to an employer-arranged conference. A private-use portion of the operating expenses of a taxi. A company provides a car to the managing director for both business and private uses. As the managing director’s licence has suspended for 4 months, the company provides the services of a chauffeur to the managing...

Briefly describe two taxable fringe benefits and two non-taxable fringe benefits that employers frequently offer to...

Briefly describe two taxable fringe benefits and two non-taxable fringe benefits that employers frequently offer to their full-time employees

A. Optimum Fringe Benefits 1. Briefly explain how offering fringe benefits for employees can generate profits...

A. Optimum Fringe Benefits 1. Briefly explain how offering fringe benefits for employees can generate profits for firms. Why do some firms not offer fringe benefits? 2. Use the concept of “optimum fringe benefits” to assess the wisdom of Congress mandating that employers offer some specific fringe benefit (day care for children of employees, say) free of charge.

Discuss the Fringe Benefits Tax (FBT) implications of the following cases (a) – (e):

Discuss the Fringe Benefits Tax (FBT) implications of the following cases (a) – (e): (Note - No calculations are needed. Only answer whether the employer is liable for FBT or not and why or why not) (a) An employer provides a Christmas lunch at a local restaurant, costing $1,000, for 10 of its key employees. (b) A sporting club, which pays its honorary treasurer an honorarium of $5,000 per year, providing a car to him. The car is used 90%...

why are fringe benefits considered variable costs?

Payroll for Kicker Sound Systems for January was $150,000 and the following withholdings, fringe benefits, and...

Payroll for Kicker Sound Systems for January was $150,000 and the following withholdings, fringe benefits, and payroll taxes apply: Federal and state income taxes withheld $38,000 Health insurance premiums (Blue Cross) paid by employer 12,000 Contribution to retirement plan (Fidelity) paid by employer 15,000 FICA tax rate (Social Security and Medicare) 7.65% Federal and state unemployment tax rate 3.80% Kicker has paid none of the withholdings or payroll taxes by the end of January and no employee's cumulative wages exceed...

QUESTION 3 Discuss the Fringe Benefits Tax (FBT) implications of the following cases (a) – (e):...

QUESTION 3 Discuss the Fringe Benefits Tax (FBT) implications of the following cases (a) – (e): (Note - No calculations are needed. Only answer whether the employer is liable for FBT or not and why or why not) (a) An employer provides a Christmas lunch at a local restaurant, costing $1,000, for 10 of its key employees. (b) A sporting club, which pays its honorary treasurer an honorarium of $5,000 per year, providing a car to him. The car is...

Caribbean Tours' total payroll for the month of January was $420,000. The following withholdings, fringe benefits,...

Caribbean Tours' total payroll for the month of January was $420,000. The following withholdings, fringe benefits, and payroll taxes apply: Federal and state income tax withheld $ 42,000 Health insurance premiums paid by employer (payable to Blue Cross) 7,560 Contribution to retirement plan paid by employer (payable to Fidelity) 16,800 FICA tax rate (Social Security and Medicare) 7.65 % Federal and state unemployment tax rate 6.20 % Assume that none of the withholdings or payroll taxes has been paid by...

Caribbean Tours' total payroll for the month of January was $520,000. The following withholdings, fringe benefits,...

Caribbean Tours' total payroll for the month of January was $520,000. The following withholdings, fringe benefits, and payroll taxes apply: Federal and state income tax withheld $ 52,000 Health insurance premiums paid by employer (payable to Blue Cross) 9,360 Contribution to retirement plan paid by employer (payable to Fidelity) 20,800 FICA tax rate (Social Security and Medicare) 7.65 % Federal and state unemployment tax rate 6.20 % Assume that none of the withholdings or payroll taxes has been paid...

Question