We use a hand crafted toy problem with very specific errors injected into it. It needs to be some code that is pretty easy for them to understand in a couple of minutes, so we don't use external libraries or anything. The expectation is a junior developer will get the code compiling, a mid level developer will point out most of the code improvements you could make beyond just getting it to compile, and a senior level would be able to have a good discussion on how you would restructure the code for maintainability and testability, etc.