Exam 5: Employee Net Pay and Pay Methods

Julio is single with 1 withholding allowance. He earned $1,025.00 during the most recent semimonthly pay period. He needs to decide between contributing 3% and $30 to his 401(k) plan. If he chooses the method that results in the lowest taxable income, how much will be withheld for Federal income tax (based on the following table)?

The annual payroll tax guide that the IRS distributes is called ________.

The purpose of the wage base used for the Social Security tax is ________.

The use of paycards as a means of transmitting employee pay began in the 1990s with over-the-road drivers out of a need to transmit funds reliably on payday.

What payroll-specific tool is used to facilitate computation of net pay?

When a payroll check is subject to escheatment, who handles the distribution of the money?

What role does the employer play regarding an employee's federal withholding tax?

Why might an employee elect to have additional federal income tax withheld? (Select all that apply.)

Collin is a full-time exempt employee in Juneau, Alaska, who earns $135,000 annually and has not yet reached the Social Security wage base. He is single with 1 withholding allowance and is paid semimonthly. He contributes 3% per pay period to his 401(k) and has pre-tax health insurance and AFLAC deductions of $150 and $25, respectively. Collin has a child support garnishment of $300 per pay period. What is his net pay? (Use the percentage method. Do not round interim calculations, only round final answer to two decimal points.) Table 5. Percentage Method-2017 Amount for One Withholding Allowance Federal Income tax using percentage method

Computation of net pay involves deducting mandatory and voluntary deductions from gross pay.

Why do employers use checks as an employment payment method?

Which are steps in the net pay computation process? (Select all that apply.)

Max earned $1,019.55 during the most recent semimonthly pay period. He is single with 1 withholding allowance and has no pre-tax deductions. Using the following table, how much should be withheld for federal income tax?

Amity is an employee with a period gross pay of $2,000. She elects to have 3% of her gross pay withheld for her 401(k) contribution. What will be her taxable income be for federal income taxes?

Manju is a full-time exempt employee living in Illinois who earns $43,680 annually and is paid biweekly. She is married with three withholding allowances. What is the total of her Federal and state income tax deductions for the most recent pay period? (Use the wage bracket tables. Illinois state income tax rate is 3.75%.)

The wage-bracket of determining federal tax withholding yields more accurate amounts than the percentage method.

Renee is a salaried exempt employee who earns an annual salary of $64,200, which is paid semimonthly. She is married with four withholding allowances. What is her total FICA tax liability per pay period? (Do not round interim calculations, only round final answer to two decimal points.)

Which of the following states do not have state income tax deducted from employee pay? (Select all that apply.)

Janna is a salaried nonexempt employee in Laramie, Wyoming, who earns $30,000 per year for a standard 40-hour workweek and is paid biweekly. She is single with one withholding allowance. During the last pay period, she worked 5 hours of overtime. She contributes 3% of her gross pay to her 401(k) on a pre-tax basis and has a garnishment of 10% of her disposable income for a consumer credit garnishment. What is her net pay? (Use the wage-bracket method. Do not round interim calculations, only round final answer to two decimal points.)

Which of the following statements is/are true about Medicare tax? (Select all that apply.)