Deck 6: Analyzing and Journalizing Payroll

Question 1

Tax withholdings from employees' pays reduce the amount of the debit to Salary Expense in the payroll entry.

Answer 1

False

Question 2

Amounts withheld from employees' wages for health insurance are credited to a liability account.

Answer 2

True

Question 3

Once the journal entry for the payroll is complete,the information is posted to the appropriate general ledger accounts.

Answer 3

True

Question 4

Each payday,the total of net pays that the employer incurs is the wage expense that must be debited.

Question 5

Deductions from gross pay in the payroll register are reflected on the credit side of the journal entry to record the payroll.

Question 6

A debit to the employees FIT payable account removes the liability for the amount of federal income taxes withheld from employees' wages.

Question 7

Every state allows employers to make e-payment options as a condition of employment.

Question 8

When withheld union dues are turned over to the union by the employer,a journal entry is made debiting the liability account and crediting the cash account.

Question 9

An employer will use the payroll register to keep track of an employee's accumulated wages.

Question 10

Tips received by employees in excess of tip credit amount are not included as disposable earnings subject to garnishment

Question 11

The total of the net amount paid to employees each payday is credited to either the cash account or the salaries payable account.

Question 12

The wage and salaries expense account is an operating expense account debited for total net pay each payroll period.

Question 13

FIT Payable is a liability account used to record employees' withheld federal income tax and also the employer's match of that tax.

Question 14

Under the provisions of the Consumer Credit Protection Act,an employer can discharge an employee simply because the employee's wage is subject to garnishment for a single indebtedness.

Question 15

Under the Consumer Credit Protection Act,disposable earnings are the earnings remaining after any deductions for health insurance.

Question 16

Service charges that are passed on to the employee by the employer are not part of the disposable earnings subject to garnishment.

Question 17

If wages are paid weekly,postings to the employee's earnings record would be done once a month.

Question 18

An employee's marital status and number of withholding allowances never appear on the payroll register.

Question 19

In order to prepare Forms W-2,an employer would utilize the employee's earnings record.

Question 20

Companies usually provide a separate column in the payroll register to record the employer's payroll taxes.

Question 21

The employer's payroll tax expenses are recorded by all employers at the time these taxes are actually paid.

Question 22

The payroll taxes account is an expense account that is debited for the FICA,FUTA,and SUTA taxes on the employer.

Question 23

In the adjusting entry to accrue wages at the end of the accounting period,there is no need to credit any tax withholding accounts.

Question 24

Posting to the general ledger for payroll entries is done only at the end of each calendar year.

Question 25

Since vacation time is paid when used,there is no need to accrue this time in a liability account at the end of each accounting period.

Question 26

If employees must contribute to the state unemployment fund,this deduction should be shown in the payroll tax entry.

Question 27

The FUTA tax part of the payroll tax entry is recorded at the net amount (0.6%)of the taxable payroll.

Question 28

The FICA taxes on the employer represent both business expenses and liabilities of the employer.

Question 29

Under the Uniform Unclaimed Property Act,any unclaimed paychecks must be turned over to the state after the next payday.

Question 30

The adjusting entry to record the accrued vacation pay at the end of an accounting period includes credits to the tax withholding liability accounts.

Question 31

Union Dues Payable is a liability account credited with the deductions made from union members' wages for their union dues.

Question 32

The entry to record the employer's payroll taxes usually includes credits to the liability accounts for FICA (OASDI and HI),FUTA,and SUTA taxes.

Question 33

At the time that the entry is made to record the employer's payroll taxes,the SUTA tax is recorded at the net amount (0.6%).

Question 34

Since the FUTA tax is a social security tax,it can be charged to the same expense account as the other payroll taxes on the employer,the payroll taxes account.

Question 35

FICA Taxes Payable-OASDI is a liability account debited for the employer's portion of the FICA tax.

Question 36

When the federal tax deposit is made,the employees' and employer's shares of FICA taxes are paid along with the employees' FIT taxes withheld.

Question 37

FUTA Taxes Payable is an expense account in which are recorded the employer's federal unemployment taxes.

Question 38

The payroll taxes incurred by an employer are FICA,FUTA,and SUTA.

Question 39

Since the credit against the FUTA tax (for SUTA contributions)is made on Form 940,the employer's payroll tax entries should include the FUTA tax at the gross amount (6.0%).

Question 40

Since FUTA tax is paid only once a quarter,the FUTA tax expense is recorded only at the time of payment.

Question 41

Which of these accounts shows the total gross earnings that the employer incurs as an expense each payday?

A) Payroll Taxes
B) Federal Income Taxes Payable
C) Wages Expense
D) Salaries Payable
E) None of the above

Question 42

Carmen Gaetano worked 46 hours during this payweek.He is paid time-and-a-half for hours over 40 and his pay rate is $17.90/hour.What was his overtime premium pay for this workweek?

A) $107.40
B) $161.10
C) $50.70
D) $53.70
E) $26.85

Question 43

Which of the following accounts is an expense account in which an employer records the FICA,FUTA,and SUTA taxes?

A) Wages Expense
B) Payroll Taxes
C) SUTA Taxes Payable
D) Salaries Payable
E) None of the above

Question 44

Exhibit 6-1
The totals from the first payroll of the year are shown below.
​ ​
Refer to Exhibit 6-1.Journalize the entry to record the payroll.

Question 45

In recording the monthly adjusting entry for accrued wages at the end of the accounting period,the amount of the adjustment would usually be determined by:

A) collecting the timesheets for the days accrued.
B) using the same amount as the prior month's adjustment.
C) using the wages of the salaried workers only.
D) a percentage of the previous week's gross payroll.
E) a percentage of the previous week's net payroll.

Question 46

Which of the following items would require an adjusting entry at the end of each accounting period?

A) Garnishment for child support payments
B) Withholdings for a 401(k)plan
C) Vacation pay earned by employees
D) Union dues withheld
E) None of the above

Question 47

The garnishment that takes priority over all others is :​

A) ​a federal tax levy
B) ​a government student loan
C) ​a creditor garnishment
D) ​an administrative wage garnishment
E) ​a child support order

Question 48

When recording the deposit of FUTA taxes owed,the proper entry is:

A) FUTA Tax Expense
Cash
B) Payroll Taxes
Cash
C) Payroll Taxes
FUTA Taxes Payable
D) FUTA Taxes Payable
Cash
E) FUTA Tax Expense
FUTA Taxes Payable

Question 49

Exhibit 6-1
The totals from the first payroll of the year are shown below.
​ ​
Refer to Exhibit 6-1.Journalize the entry to deposit the FICA and FIT taxes.

Question 50

Exhibit 6-1
The totals from the first payroll of the year are shown below.
​ ​
Refer to Exhibit 6-1.Journalize the entry to record the employer's payroll taxes (assume a SUTA rate of 3.7%).

Question 51

The employee's earnings record provides information for each of the following except:

A) completing Forms W-2.
B) completing the journal entry to record the payroll.
C) determining when the accumulated wages of an employee reach cutoff levels.
D) preparing reports required by state unemployment compensation laws.
E) preparing the payroll register.

Question 52

Exhibit 6-1
The totals from the first payroll of the year are shown below.
​ ​
Refer to Exhibit 6-1.Journalize the adjustment for accrued wages for the following Monday,which is the end of the accounting period.The gross payroll for that day is $7,475.​

Question 53

Which of the following is not an expense of the employer?

A) FUTA tax
B) FICA tax-HI
C) FICA tax-OASDI
D) SUTA tax
E) Union dues withheld

Question 54

The entry made at the end of the accounting period to record wages incurred but unpaid is:

A) Wages Expense
Wages Payable
B) Wages Expense
FICA Taxes Payable-OASDI
FICA Taxes Payable-HI
FIT Payable
Wages Payable
C) Wages Payable
Cash
D) Wages Expense
Cash
E) Wages Expense
Payroll Taxes
Wages Payroll