Exam 28: Payroll Accounting

Warren Company's payroll for the week ending January 15 amounted to $200,000 for salaries and wages. None of the employees has reached the earnings limits specified for federal or state employer payroll taxes. The following deductions were withheld from employees' salaries and wages: Federal unemployment tax (FUTA) rate is 6.2% less a credit equal to the rate paid for state unemployment taxes. The state unemployment tax (SUTA) rate is 5.4%. Instructions Prepare the journal entries to record the weekly payroll ending January 15 and also the employer's payroll tax expense on the payroll.

Sam Geller had earned (accumulated) salary of $110,000 through November 30. His December salary amounted to $9,800. Lara Lane began employment on December 1 and will be paid her first month's salary of $7,000 on December 31. Income tax withholding for December for each employee is as follows: The following payroll tax rates are applicable: *Less a credit equal to the state unemployment contribution Instructions Record the payroll for the two employees at December 31 and record the employer's share of payroll tax expense for the December 31 payroll. Round all calculations to the nearest dollar.

The form showing gross earnings, FICA taxes withheld, and income taxes withheld for the year is

The effective federal unemployment tax rate is usually

An employee's time card is used to record the number of exemptions claimed by the employee for income tax withholding purposes.

The journal entry to record the payroll for a period will include a credit to Salaries and Wages Payable for the gross

The state unemployment tax rate is usually 5.4% on the first $7,000 of wages paid to an employee during the year.

FICA taxes and federal income taxes are levied on employees' earnings without limit.

A good internal control feature is to have a written hiring authorization form completed before a new employee is added to the payroll.

The employer incurs a payroll tax expense equal to the amount withheld from the employees' wages for federal income taxes.

Most companies are required to compute overtime at

An employee earnings record is a cumulative record of each employee's gross earnings, deductions, and net pay during the year.

By January 31 following the end of a calendar year, an employer is required to provide each employee with a(n)

Which one of the following payroll taxes is not withheld from the employee's wages because it is not levied on the employee?

The following payroll liability accounts are included in the ledger of Clementine Company on January 1, 2018: In January, the following transactions occurred: Jan. 9 Sent a check for $5,000 to Blue Cross and Blue Shield. 11 Deposited a check for $5,600 in Federal Reserve Bank for FICA taxes and federal income taxes withheld. 14 Sent a check for $400 to the union treasurer for union dues. 18 Paid state income taxes withheld from employees. 21 Paid state and federal unemployment taxes. 22 Purchased U. S. Savings Bonds for employees by writing a check for $1,000. Instructions Journalize the January transactions

Which of the following is not performed by the payroll department?

Match the codes assigned to the following payroll functions to the procedures listed below: H = Hiring Employees PRE = Preparing the Payroll T = Timekeeping PAY = Paying the Payroll 1. ____ Distribution of checks by the treasurer. 2. ____ Supervisor approves hours worked. 3. ____ Posting job openings. 4. ____ Maintenance of payroll records. 5. ____ Verification of payroll calculations. 6. ____ Screening and interviewing of job applicants. 7. ____ Employment authorization. 8. ____ Signing prenumbered payroll checks. 9. ____ Use of a timeclock. 10. ____ Payroll tax return preparation. 11. ____ Employee signs receipt acknowledging cash received. 12. ____ Documentation of employee hiring.