Deck 13: Accounting for Payroll and Payroll Taxes

Question 1

In each pay period, the payroll information for each employee is recorded on his or her employee earnings record.

Answer 1

True

Question 2

The payroll register provides all the payroll information needed to prepare a payroll.

Answer 2

False

Question 3

A business deposits the total of gross wages in a separate payroll checking account.

Answer 3

False

Question 4

Employer payroll taxes are business expenses.

Question 5

The employer social security tax rate is different than the employee social security tax rate.

Question 6

Federal unemployment insurance laws require that employers and employees pay taxes for unemployment compensation.

Question 7

The transaction to record employer payroll taxes expense is journalized at the end of the quarter.

Question 8

Each employer is required by law to periodically report the payroll taxes withheld from employee salaries.

Question 9

The timing of payroll tax payments is based on the amount owed.

Question 10

Form W-2 reports an employee's annual earnings and the withholdings for federal income, social security, and Medicare taxes.

Question 11

In the journal entry for a payroll, the amount debited to Salary Expense is the total of the Net Pay column of the payroll register.

Question 12

The tax base for Medicare tax is the same as the tax base for social security tax.

Question 13

If an employee's accumulated earnings are $6,500.00, and the employee earns another $1,500.00, the amount of new earnings subject to unemployment tax is $1,500.00.

Question 14

Some employers must deposit payments for withheld employees' federal income tax and social security and Medicare taxes on the next banking day.

Question 15

Each employer who withholds income tax, social security tax, and Medicare tax from employee earnings must furnish each employee with a quarterly statement.

Question 16

Until the amounts withheld from employee salaries are paid by the employer, they are recorded as

A) assets.
B) liabilities.
C) salary expense.
D) revenue.

Question 17

The payment of payroll taxes to the government is referred to as a

A) tax reimbursement.
B) transfer payment.
C) deposit.
D) tax fulfillment.

Question 18

The total earnings subject to federal unemployment tax is referred to as

A) unemployment taxable earnings.
B) taxable earnings.
C) gross earnings.
D) total earnings.

Question 19

Each employer must file a _________ federal tax return showing the federal income tax, social security tax, and Medicare tax due the government.

A) monthly
B) quarterly
C) yearly
D) semiannual

Question 20

Employers are required to furnish each employee with an annual statement of earnings and withholdings before

A) December 31 of the current year.
B) January 1 of the following year.
C) January 15 of the following year.
D) January 31 of the following year.

Question 21

The source document for paying employee income tax and social security and Medicare tax is

A) a check.
B) a receipt.
C) a memorandum.
D) none of these.

Question 22

In general, employers are required to pay state unemployment taxes

A) monthly.
B) during the month following each calendar quarter.
C) annually.
D) none of these.

Question 23

The source document for paying state unemployment tax is

A) a check.
B) a receipt.
C) a memorandum.
D) none of these.

Question 24

A state tax used to pay benefits to unemployed workers is

A) social security tax.
B) Medicare tax.
C) federal unemployment tax.
D) state unemployment tax.