Terms 2 Flashcards
Overtime pay
1 1/2 times regular pay for hours above 40 hours per week.
Minimum wage
The lowest pay rate allowed by law for each hour worked.
Salaried
- do not keep time cards
- have more flexibility in the time they work
- often work more than 40 hours week/no overtime
Tips
Money or gift given to a person that is subject to federal taxes.
Commission
A percentage of a sale paid to a salesperson instead of or in addition or salary or wages.
Self-employment
An entrepreneur takes risk of being self-employed or owning a business.
Advantages
You can make decisions about how to work or run the business.
You can keep profits from your work or the business.
Disadvantages
Involves high risk.
Often requires long work hours.
Profits
The amount of money left after all costs are deducted from the income of a business.
Benefits
Form of pay or other than salary or wages.
Pay without work
Refers to times when am employee who is not working will be paid. (Ex. Vacation, sick days, paid holiday)
Premium
Price we pay for insurance.
Short term disability
Coverage for up to two years
Long term disability
Coverage for longer than two years and up to retirement
401K
Allows employees to put aside money that is not subject to federal income tax at a time is earned; will be taxed later and some employers match contributions.
Pension plan
Retirement account paid for entirely by employer; typically must be w/ company for certain # of years
Profit sharing plan
Means when company does well, employees get a share of profits.
Stock option plan
Allow employees to buy stock in the company at a reduced price.
Health flex spending
Allows employee to set aside $ to pay for qualified expenses that is not subject to federal income tax.
Educational reimbursement
Employers may provide pay back for money spend on training and education.
Perks
Other types of benefits such as prime parking space, office with a view, account expenses, or car.
Insurance available
Health, life and disability insurance.
Unearned income
Is money received from sources other than working in a job.
Dividend
Money shared with a stockholder when a corporation makes profits.
Transfer payment
Money and benefits received from local, state, or federal governments.
In-kind transfer payment
Food stamps, rent, and Medicaid.
In-cash transfer payment
Checks, debits, or other direct payments.
Taxes
Required payments to a government.
Costs of paying taxes
Paying taxes reduces disposable income.
Less money is left to spend or save.
Lower spending may affect the economy.
Use taxes
Are taxes paid by people who use certain goods or services such as visiting parks.
Excise taxes
Are charged on the purchase of specific goods such as motor fuel, cigarettes.
Luxury taxes
Are charged on products not considered essential for a normal standard of living like an expensive car.
