Which statement describes Pay Balances in payroll?

• A. A list of payroll runs
• B. A record used to calculate year-to-date employee tips
• C. A summary of gross pay
• D. A calculation method for bonuses

Answer: (B)

Pay Balances represent the year-to-date total for an employee’s pay, including any tips, and are used to determine how much tip income has accrued up to the current period. This ongoing accumulation is what enables accurate year-to-date tip calculation and reporting for each employee. It's not describing a list of payroll runs, a simple summary of gross pay, or a method for calculating bonuses—the concept here is the continuous, period-to-period total that tracks tips across payroll processing.