Question 1

Which one of the following payroll taxes does not result in a payroll tax expense for the employer?

Accepted Answer

A)  FICA tax
B)  Federal income tax
C)  Federal unemployment tax
D)  State unemployment tax B

Question 2

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

Accepted Answer

A) True 
 B)False  True

Question 3

FICA taxes withheld and federal income taxes withheld are mandatory payroll deductions.

Accepted Answer

A) True 
 B)False  True

Question 4

Assuming a FICA tax rate of 8% on the first $106,800 in wages, and a federal income tax rate of 20% on all wages, what would be an employee's net pay for the year if he earned $108,000?

Accepted Answer

A)  $99,456
B)  $77,760
C)  $86,400
D)  $77,856

Question 5

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

Accepted Answer

A)  amount less all payroll deductions.
B)  amount of all paychecks issued.
C)  pay less taxes payable.
D)  pay less voluntary deductions.

Question 6

Jerri Rice has worked 44 hours this week.She worked in excess of 8 hours each day.Her regular hourly wage is $15 per hour.What are Jerri's gross wages for the week? (The company Jerri works for is in compliance with the Fair Labor Standards Act.)

Accepted Answer

A)  $660
B)  $690
C)  $990
D)  $720

Question 7

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

Accepted Answer

A)  state unemployment tax form.
B)  federal unemployment tax form 940.
C)  wage and tax statement form W-2.
D)  employee's withholding allowance certificate form W-4.

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

A Wage and Tax Statement shows gross earnings, FICA taxes withheld, and income taxes withheld for the year.

Accepted Answer

A) True 
 B)False

Question 10

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

Accepted Answer

A) True 
 B)False

Question 11

FICA taxes do not provide workers with

Accepted Answer

A)  life insurance.
B)  supplemental retirement.
C)  employment disability.
D)  medical benefits.

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A)  Preparation of payroll checks
B)  Maintaining payroll records
C)  Signing of payroll checks
D)  Preparation of payroll tax returns

Question 14

The effective federal unemployment tax rate is usually

Accepted Answer

A)  6.2%.
B)  0.8%.
C)  5.4%.
D)  8.0%.

Question 15

Changes in pay rates during employment should be authorized by the

Accepted Answer

A)  personnel department.
B)  payroll department.
C)  treasurer's department.
D)  timekeeping department.

Question 16

Control over timekeeping does not include

Accepted Answer

A)  having one employee punch the time cards for several employees in the same work area.
B)  time clock procedure monitoring by a supervisor.
C)  pay period time reports kept by a supervisor for salaried personnel.
D)  overtime approval by a supervisor.

Question 17

Which of the following employees would likely receive a salary instead of wages?

Accepted Answer

A)  Store clerk
B)  Factory employee
C)  Sales manager
D)  Manual laborer

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Most companies involved in interstate commerce are required to compute overtime at

Accepted Answer

A)  the worker's regular hourly wage.
B)  1.25 times the worker's regular hourly wage.
C)  1.5 times the worker's regular hourly wage.
D)  2.5 times the worker's regular hourly wage.

Question 20

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

Accepted Answer

A) True 
 B)False

Exam 15: Payroll Accounting

Which one of the following payroll taxes does not result in a payroll tax expense for the employer?

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

FICA taxes withheld and federal income taxes withheld are mandatory payroll deductions.

Assuming a FICA tax rate of 8% on the first $106,800 in wages, and a federal income tax rate of 20% on all wages, what would be an employee's net pay for the year if he earned $108,000?

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

Jerri Rice has worked 44 hours this week.She worked in excess of 8 hours each day.Her regular hourly wage is $15 per hour.What are Jerri's gross wages for the week? (The company Jerri works for is in compliance with the Fair Labor Standards Act.)

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

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

A Wage and Tax Statement shows gross earnings, FICA taxes withheld, and income taxes withheld for the year.

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

FICA taxes do not provide workers with

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

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

The effective federal unemployment tax rate is usually

Changes in pay rates during employment should be authorized by the

Control over timekeeping does not include

Which of the following employees would likely receive a salary instead of wages?

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

Most companies involved in interstate commerce are required to compute overtime at

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