Definition
Money received without direct labor, like from investments
Unearned Income
Money earned through direct work or labor
Earned Income
Lowest legally allowed hourly wage
Minimum Wage
What is a common form of income for self-employed individuals?
Earnings from freelancing, Dividends from investments, Wages from an employer, Transfer payments
Earnings from freelancing
What is the minimum wage in Louisiana?
$7.50
Fixed annual amount paid to an employee
Salary
Payment made by a tenant for using property
Rent
Voluntary extra payment to service workers
Tips
What type of income is a commission?
Earned income
Scenario: Jamikal works as a waitress and earns:
- $11/hour base wage (8 hours per shift)
- Averages $65 in tips per shift
- Receives a $900 annual bonus
Calculate her total earned income for the year, assuming she works 5 shifts per week for 50 weeks.
$39,150
Payment to shareholders from company profits
Dividend
Extra payment for achieving performance goals
Bonus
Cost of borrowing or loaning money
Interest
Which of the following is not considered unearned income?
Wages from a part-time job, Interest from a savings account, Rent from property, Dividends from Investment
Wages from a part-time job
What distinguishes unearned income from transfer payments
Transfer payments are usually received from the government.
Money received when losing a job through no fault of one's own
Unemployment Compensation
Working independently using personal skills
Self-employment
Money received when losing a job through no fault of one's own
Unemployment Compensation
Which type of income would a person receive from renting out an apartment?
Earned Income, Transfer Payment, Salary, Passive Income
Passive Income
Which form of income is primarily received from government programs?
Wages, Dividends, Capital Gains, Transfer Payments
Transfer Payments
Profit earned from selling an asset
Capital Gain
Payments made to people without requiring work
Transfer Payments
Money paid as a percentage of revenue generated
Commission
How is overtime pay calculated according to the Fair Labor Standards Act (FLSA)?
At least 50% more than an employee’s normal wage.
If a person earns a salary of $75,000 per year and is paid semi-monthly, how much is paid each pay period?
$3,000, $2,083.33, $3,125, $2,884.62
$3,125