Deck 9: Payroll

Question 1

A draw is an advance that need not be repaid if the commission does not exceed the draw.

Answer 1

False

Question 2

An override can never help increase a manager's total pay.

Answer 2

False

Question 3

Gross pay = hours worked × rate per hour.

Answer 3

True

Question 4

Net pay - deductions = gross pay.

Question 5

In the portion formula, the commission a worker receives would be the base.

Question 6

A variable commission scale means that for different levels of net sales there are different commission rates.

Question 7

A married person will pay in more Social Security and Medicare tax than a single person.

Question 8

The number of dependents one claims does not affect the amount of Social Security and Medicare tax paid.

Question 9

The Fair Labor Standards Act entitles employees to time and a half over 36 1/2 hours.

Question 10

Overtime is always calculated at time and a half the regular rate.

Question 11

An employee's commission is always based on total dollar sales.

Question 12

Being paid biweekly means the salary is paid twice a month.

Question 13

A self-employed person has at least three employees.

Question 14

A calendar year is July 1 to June 30.

Question 15

The employer will match the employee's Social Security and Medicare contribution.

Question 16

The Federal Insurance Contributions Act funds the federal income tax program.

Question 17

Being paid biweekly is the same as being paid semimonthly.

Question 18

Differential pay means that there is one fixed rate per unit that is produced.

Question 19

FICA stands for federal withholding tax.

Question 20

Straight piece rate pay provides a worker an incentive to produce more since pay is based on the number of units produced.

Question 21

The W-4 is used strictly to calculate Social Security and Medicare taxes.

Question 22

The more allowances claimed on Form W-4:

A)The less money deducted for FIT
B)The more money deducted for FIT
C)No FIT ever deducted
D)FUTA increase
E)None of these

Question 23

The FICA tax now requires separate reporting for Social Security and Medicare.

Question 24

If you are paid twice a month, you are being paid:

A)Weekly
B)Biweekly
C)Semimonthly
D)Monthly
E)None of these

Question 25

The base amount for calculating Social Security taxes never changes from year to year.

Question 26

The Labor Fair Standards Act:

A)Sets minimum wage standards
B)Sets overtime regulations
C)Is a federal act
D)May exempt certain workers
E)None of these

Question 27

The higher the number claimed on form W-2, the less in taxes will be taken out of one's paycheck.

Question 28

Circular E from the Internal Revenue Service contains many tax tables.

Question 29

John Flynn works at Stutz Toyota and is paid a(n) __________ against his earned commissions.

A)Bonus to one's salary
B)Salary
C)Draw
D)Amount that is never paid back
E)None of these

Question 30

The percentage method can be used to determine the amount of FIT.

Question 31

A quarter is 13 weeks.

Question 32

There is a maximum amount of Medicare tax an employee can contribute in a calendar year.

Question 33

SUTA tax is usually paid quarterly.

Question 34

Payroll registers cannot record cumulative earnings.

Question 35

Differential pay schedule is based on:

A)FICA
B)Different levels of performance
C)FUTA
D)Gross pay
E)None of these

Question 36

The taxable earnings column of a payroll register shows the actual tax.

Question 37

Exempt wages means not taxable wages.

Question 38

Social Security and Medicare tax:

A)Have different rates
B)Are paid only by employees
C)Are based on the number of dependents not claimed
D)Are paid by only the employer
E)None of these

Question 39

FUTA tax is computed by the wage-bracket table.

Question 40

SUTA tax has no maximum amount that can be paid in a calendar year.

Question 41

Sandi works for Elizabeth Arden Cosmetics and earns $500 per week salary plus 4% commission on sales over $2,000. If Sandi sold $2,733 last week, what was her salary?

A)$1,046.66
B)$2,743.00
C)$609.32
D)$906.32
E)None of these

Question 42

The percentage method aids in calculating:

A)SUTA
B)FUTA
C)FICA
D)FIT
E)None of these

Question 43

A merit rating system for SUTA means:

A)Rates cannot change
B)State rates will always be lower
C)Rate varies with employment record
D)FUTA will increase
E)None of these

Question 44

Lee Wong is a sales clerk at Sears. She is paid $8.00 per hour plus a commission of 4% on all sales. Assuming Lee works 39 hours and has sales of $4,000, her gross pay is:

A)$312
B)$321
C)$472
D)$427
E)None of these

Question 45

Lana Powell has cumulative earnings of $110,000 at the end of September. In the first week in October she earns $2,000. The amount deducted for Social Security and Medicare from her check is (assume Social Security rate of 6.2% on $110,100 and Medicare of 1.45%):

A)$29.00
B)$35.20
C)$53.20
D)$92.00
E)None of these

Question 46

Jill Hartman earns $750 per week plus 3% of sales in excess of $6,500. If Jill sells $25,000 in the first week, her earnings are:

A)$945
B)$1,305
C)$1,500
D)$1,503
E)None of these

Question 47

Ron Swift earned $1,500 last week. He is married, is paid biweekly, and claims two exemptions. Using the percentage method (use tables in the handbook), his income tax is:

A)$109.69
B)$116.40
C)$100.91
D)$140.88
E)None of these

Question 48

David is paid on a graduated commission scale at Nooter Company. He receives 2% commission on the first $20,000, 6% on sales from $20,000 to $70,000, 8.5% commission on sales from $70,000 to $100,000, and 10% commission on sales over $100,000. David had sales of $82,000. His commission is:

A)$8,200
B)$6,200
C)$4,240
D)$4,420
E)None of these

Question 49

Bill Burne's earnings are subject to deductions for Social Security, Medicare, and FIT. To date his cumulative earnings are $110,000. This week Bill earns $1,200. Bill, who is married, is paid weekly and claims three exemptions. Assume the Social Security rate is 6.2% on $110,100 and 1.45% for Medicare. His net pay for the week is (use percentage table in handbook to calculate FIT):

A)$528.43
B)$1,069.39
C)$1,690.93
D)$1,609.93
E)None of these

Question 50

Leo Corporation pays its employees on a graduated commission scale: 6% on the first $40,000 in sales, 7% on sales from $40,000 to $80,000, and 9% on sales greater than $80,000. Bernie Kaminsky had sales of $105,000. His commission is:

A)$2,400
B)$7,450
C)$5,200
D)$1,350
E)None of these

Question 51

Bob Neff, owner of an automotive dealership, pays one of his salesmen, Mike, a $1,300 draw per week plus 6% on all commission sales. Mike sold seven cars over the four-week period, totaling $186,900 for the month. Mike's commission plus the draw is:

A)$6,014
B)$6,041
C)$16,414
D)$5,200
E)None of these

Question 52

To date, Jay Ward has cumulative earnings of $107,600. This week he is paid $3,000. The total amount of Social Security tax for this week is (assume a rate of 6.2% on $110,100 for Social Security and 1.45% for Medicare):

A)$186.00
B)$155.00
C)$57.66
D)$180.00
E)None of these

Question 53

Percentage method tables can show:

A)Weekly period rates
B)Biweekly payroll rates
C)Semimonthly payroll rates
D)Monthly payroll rates
E)None of these

Question 54

FUTA tax is paid:

A)By an employee
B)By the employer
C)By both the employee and the employer
D)Only weekly
E)None of these

Question 55

Jim Smith is a salesman who receives a $1,100 draw per week. He receives a 12% commission on all sales. Sales for Jim were $205,000 for the month. Assuming a four-week month, Jim's commission after the draw is: Three allowances
59)62 x 3 = 178.86 1200 - 178.86 = 1021.14
FIT 17.12 + 125.40 = 142.52
100 x .062 = 6.20
1200 x. 0145 = 17.40
1200 - 6.20 - 17.40 - 142.52 = 1033.88

A)$24,600
B)$20,200
C)$23,500
D)$26,400
E)None of these

Question 56

Mindy makes boots for Belleville Boot Factory. She is paid on the following differential pay scale: What is Mindy's pay if she produced 192 boots for the week?

A)$602.30
B)$702.90
C)$1,152.00
D)$620.30
E)None of these

Question 57

The taxable earnings column of a payroll register records:

A)What wages will be taxed
B)The actual tax
C)The estimated tax
D)All of these
E)None of these

Question 58

Jasper works at Panera Company for $11.25 per hour plus a commission of 2% of her sales. Assuming Jasper worked 26 hours last week and had sales of $2,610, her gross pay is:

A)$290.50
B)$344.70
C)$351.20
D)$342.00
E)None of these

Question 59

Jim Ross is an automobile salesman who receives a salary of $500 per week plus a commission of 3% on all sales. During a four-week period he sold $42,000 worth of cars. What were Jim's average earnings?

A)$404
B)$1,760
C)$1,670
D)$440
E)None of these

Question 60

FICA tax base:

A)Never changes
B)Changes yearly
C)Changes once every two years
D)Is never more than $60,000
E)None of these

Question 61

Janet Smooth pays her workers $175, $465, and $710, respectively, per week. Calculate what Janet will pay at the end of the first quarter for (A) state unemployment and (B) federal unemployment. Assume a state rate of 5.6%. Federal is .8%. Base is $7,000.

Question 62

Janice Tax, an accountant for Flee Corp., earned $102,700 from January to June. In July she earned $8,000. Assuming a FICA tax rate of 6.2% for Social Security on $110,100 and 1.45% for Medicare, (A) how much of this month's earnings are taxed for Social Security and Medicare? and (B) what is the amount of FICA tax for Social Security and Medicare?