Questions: Which of the following terms best defines payroll? It is the process of forming a pension plan. It is the process of paying employees. It is the process of organizing accounts payable. It is the process of creating accounts.

Which of the following terms best defines payroll?
It is the process of forming a pension plan.
It is the process of paying employees.
It is the process of organizing accounts payable.
It is the process of creating accounts.

Transcript text: Which of the following terms best defines payroll? It is the process of forming a pension plan. It is the process of paying employees. It is the process of organizing accounts payable. It is the process of creating accounts.

Solution

The answer is: It is the process of paying employees.

Explanation

Option 1: It is the process of forming a pension plan.

This option is incorrect. Forming a pension plan involves setting up a retirement savings plan for employees, which is a different process from payroll.

Option 2: It is the process of paying employees.

This option is correct. Payroll refers to the process of calculating and distributing wages, salaries, and other forms of compensation to employees. It includes tracking hours worked, calculating pay, withholding taxes and other deductions, and issuing payments.

Option 3: It is the process of organizing accounts payable.

This option is incorrect. Organizing accounts payable involves managing the company's obligations to pay off short-term debts to its creditors or suppliers, which is not related to payroll.

Option 4: It is the process of creating accounts.

This option is incorrect. Creating accounts typically refers to setting up new accounts in a financial system, which is not related to the payroll process.

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