Question 1

Why would a business decide to use an external company to prepare their payroll checks and related reports?

Accepted Answer

Federal,state and local laws r

Question 2

Which of the following would NOT typically be an employee payroll withholding?

Accepted Answer

A) Unemployment taxes 
B) Medical Insurance 
C) State income tax 
D) Social Security 
A) Unemployment taxes 
B) Medical Insurance 
C) State income tax 
D) Social Security

Question 3

On June 15,Bob Love earned $5,000 and has the following deductions: FICA-OASDI 6.2%,FICA-Medicare 1.45%;federal income tax of $300;and state income tax $40.What is his net pay?

Accepted Answer

A) $3,400 
B) $4,277.50 
C) $4,454 
D) $$5,000 
A) $3,400 
B) $4,277.50 
C) $4,454 
D) $$5,000

Question 4

A pay period is defined as:

Accepted Answer

A) weekly. 
B) biweekly. 
C) monthly. 
D) All of the above are correct. 
A) weekly. 
B) biweekly. 
C) monthly. 
D) All of the above are correct.

Question 5

The cost of workers' compensation insurance must be estimated and paid in advance by the employer.

Accepted Answer

A) True 
 B)False

Question 6

Paul received $1,900 for working 40 hours.What was Paul's rate of pay per hour?

Accepted Answer

A) $47.50 
B) $44.00 
C) $45.00 
D) $50.00 
A) $47.50 
B) $44.00 
C) $45.00 
D) $50.00

Question 7

The journal entry to record the estimated advance premium payment for workers' compensation is:

Accepted Answer

A) 
Cash
Prepaid Insurance, Workers' Compensation 
B) 
Prepaid Insurance, Workers' Compensation
Cash 
C) 
Workers' Compensation Insurance Expense
Cash 
D) 
Workers' Compensation Insurance Payable
Cash 
A) 
Cash
Prepaid Insurance, Workers' Compensation 
B) 
Prepaid Insurance, Workers' Compensation
Cash 
C) 
Workers' Compensation Insurance Expense
Cash 
D) 
Workers' Compensation Insurance Payable
Cash

Question 8

Net pay is equal to gross pay less the amount withheld for FICA.

Accepted Answer

A) True 
 B)False

Question 9

Calculate the total wages earned for each employee (assume an overtime rate of time and a half over 40 hours):
a)Sam earns $25 per hour and worked 45 hours in one week.
b)Jim earns $20 per hour and worked 42 hours in one week.

Accepted Answer

a)$1,187.5

Question 10

Shelly's cumulative earnings before this pay period were $7,200 and gross pay for the week is $1,000.Assuming the wage base limit is $7,000,how much of this week's pay is subject to taxes for FUTA and SUTA?

Accepted Answer

A) $900 
B) $200 
C) $0 
D) $500 
A) $900 
B) $200 
C) $0 
D) $500

Question 11

Explain the purpose of workers' compensation,and discuss the premium cost to the employer.

Accepted Answer

Workers' Compensation is insurance provi

Question 12

Workers' Compensation Insurance is:

Accepted Answer

A) paid by the employer to protect the employee against job-related injury or death. 
B) paid by the employee to protect himself/herself against job-related accidents or death. 
C) paid by the employer to protect the employee against non-job-related injury or death. 
D) paid by the employee to protect himself/herself against non-job-related accidents and death. 
A) paid by the employer to protect the employee against job-related injury or death. 
B) paid by the employee to protect himself/herself against job-related accidents or death. 
C) paid by the employer to protect the employee against non-job-related injury or death. 
D) paid by the employee to protect himself/herself against non-job-related accidents and death.

Question 13

The federal government is responsible for administering an unemployment program for each state.

Accepted Answer

A) True 
 B)False

Question 14

The employer's payroll taxes do not affect the employee's paycheck.

Accepted Answer

A) True 
 B)False

Question 15

Given the following payroll items you are to identify whether they are the responsibility of the employer and/or the employee by placing an X in the appropriate column.
-$$\begin{array} { | l | l | l | } 
\hline & \text { Employer } & \text { Employee } \
\hline \text { Federal income tax } & & \
\hline
\end{array}$$

Accepted Answer

The answer of Given the following payroll items you are...

Question 16

When an employee's earnings are greater than FICA base limit during the calendar year,no more FICA-OASDI tax is deducted from earnings.

Accepted Answer

A) True 
 B)False

Question 17

The Fair Labor Standards Act must be followed if:

Accepted Answer

A) the company has more than 100 employees. 
B) the employees have received regular earnings. 
C) the company does business in more than one state. 
D) all employees are categorized as salary. 
A) the company has more than 100 employees. 
B) the employees have received regular earnings. 
C) the company does business in more than one state. 
D) all employees are categorized as salary.

Question 18

The number of allowances claimed by an employee determines how much will be withheld from their paycheck for:

Accepted Answer

A) FICA-OASDI. 
B) FICA-Medicare. 
C) federal income tax. 
D) both A and B are correct. 
A) FICA-OASDI. 
B) FICA-Medicare. 
C) federal income tax. 
D) both A and B are correct.

Question 19

What is required of an employer by the Federal Insurance Contributions Act?

Accepted Answer

The employer is required to withhold FIC

Question 20

From the following data,calculate the estimate annual advance premium for workers' compensation insurance and record it in general journal form.
 $$\begin{array} { l c c } 
\text { Department } & \text { Estimated Payroll } & \text { Rate per } \$ 100 \
\text { Office } & \$ 50,000 & \$ 0.24 \
\text { Warehouse } & 40,000 & 1.40 \
\text { Sales } & 75,000 & 0.90
\end{array}$$

Accepted Answer

The answer of From the following data,calculate the estimate annual...

Exam 7: Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Why would a business decide to use an external company to prepare their payroll checks and related reports?

Which of the following would NOT typically be an employee payroll withholding?

On June 15,Bob Love earned $5,000 and has the following deductions: FICA-OASDI 6.2%,FICA-Medicare 1.45%;federal income tax of $300;and state income tax $40.What is his net pay?

A pay period is defined as:

The cost of workers' compensation insurance must be estimated and paid in advance by the employer.

Paul received $1,900 for working 40 hours.What was Paul's rate of pay per hour?

The journal entry to record the estimated advance premium payment for workers' compensation is:

Net pay is equal to gross pay less the amount withheld for FICA.

Calculate the total wages earned for each employee (assume an overtime rate of time and a half over 40 hours): a)Sam earns $25 per hour and worked 45 hours in one week. b)Jim earns $20 per hour and worked 42 hours in one week.

Shelly's cumulative earnings before this pay period were $7,200 and gross pay for the week is $1,000.Assuming the wage base limit is $7,000,how much of this week's pay is subject to taxes for FUTA and SUTA?

Explain the purpose of workers' compensation,and discuss the premium cost to the employer.

Workers' Compensation Insurance is:

The federal government is responsible for administering an unemployment program for each state.

The employer's payroll taxes do not affect the employee's paycheck.

Given the following payroll items you are to identify whether they are the responsibility of the employer and/or the employee by placing an X in the appropriate column. - Employer Employee Federal income tax

When an employee's earnings are greater than FICA base limit during the calendar year,no more FICA-OASDI tax is deducted from earnings.

The Fair Labor Standards Act must be followed if:

The number of allowances claimed by an employee determines how much will be withheld from their paycheck for:

What is required of an employer by the Federal Insurance Contributions Act?

From the following data,calculate the estimate annual advance premium for workers' compensation insurance and record it in general journal form. Department Estimated Payroll Rate per \ 100 Office \ 50,000 \ 0.24 Warehouse 40,000 1.40 Sales 75,000 0.90

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Paying,recording,and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property,plant,equipment,and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values,dividends,treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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