Question 1

What type of an account is Wages and Salaries Payable?&#10;A)Asset&#10;B)Liability&#10;C)Revenue&#10;D)Expense

Accepted Answer

Wages and salaries payable represents the amount of wages and salaries earned by employees but not yet paid by the company. It is a liability account because the company owes this money to its employees and it will have to pay it in the future.

Question 2

Wages and Salaries Expense is:&#10;A)equal to net pay.&#10;B)equal to gross pay.&#10;C)equal to the employer's taxes.&#10;D)None of the above are correct.

Accepted Answer

Wages and Salaries Expense is equal to the gross pay, which is the total amount of compensation paid to an employee before any deductions or taxes are taken out. Net pay is the amount of compensation paid to an employee after deductions and taxes have been taken out. The employer's taxes are a separate expense and are not included in the Wages and Salaries Expense.

Question 3

The entry to record the payroll tax expense would include:&#10;A)a credit to Federal Income Taxes Payable.&#10;B)a credit to Cash.&#10;C)a credit to FICA (OASDI and Medicare)Taxes Payable.&#10;D)a credit to Wages Payable.

Accepted Answer

Payroll taxes typically include FICA (OASDI and Medicare) taxes, which are a liability that the company owes to the government. Therefore, recording the payroll tax expense would involve a credit to FICA (OASDI and Medicare) Taxes Payable. The other options mentioned (Federal Income Taxes Payable, Cash, and Wages Payable) would not be directly affected by the payroll tax expense.

Question 4

Which of the following statements is true?&#10;A)Payroll Tax Expense increases on the debit side of the account.&#10;B)FICA-Social Security Tax Payable is a liability.&#10;C)Payroll Tax Expense has a debit normal balance.&#10;D)All of these answers are correct.

Accepted Answer

All the statements are correct regarding standard accounting practices: Payroll Tax Expense increases on the debit side, FICA-Social Security Tax Payable is indeed a liability, and Payroll Tax Expense has a debit normal balance.

Question 5

Grammy's Bakery had the following information for the pay period ending June 30: Assume:
FICA-OASDI applied to the first $106,800 at a rate of 6.2%.
FICA-Medicare applied at a rate of 1.45%.
FUTA applied to the first $7,000 at a rate of 0.8%.
SUTA applied to the first $7,000 at a rate of 5.6%.
State income tax is 3.8%.
Given the above information, what would be the amount applied to Office Salaries Expense?

A)Debit $550
B)Credit $550
C)Debit $500
D)Credit $500

Accepted Answer

The answer of Grammy's Bakery had the following information for...

Question 6

Great Lakes Tutoring had the following payroll information on February 28: Assume:
FICA tax rates are: OASDI 6.2% on a limit of $106,800 and Medicare 1.45%
State Unemployment tax rate is 2% on the first $7,000
Federal Unemployment tax rate is 0.8% on the first $7,000
Using the information above, the journal entry to record the employee's tax expense would include:

A)a debit to Payroll Tax Expense in the amount of $4,000.
B)a debit to Wages and Salaries Expense in the amount of $4,000.
C)a credit to Cash in the amount of $4,000.
D)a credit to FUTA Payable for $24.

Accepted Answer

To record payroll tax expense, we need to take into account both employee and employer taxes. Therefore, we need to credit FUTA Payable and SUTA Payable for the employer taxes and debit Payroll Tax Expense for the total amount of taxes.

The calculation for each tax is as follows:

OASDI tax = 6.2% on $106,800 limit = $6,621.60
Medicare tax = 1.45% on total payroll = $1,811.50
SUTA tax = 2% on $7,000 limit = $140
FUTA tax = 0.8% on $7,000 limit = $56

Total payroll tax expense = $6,621.60 + $1,811.50 + $140 + $56 = $8,629.10

Therefore, the correct answer is D) All of the above are correct.

Question 7

Wages and Salaries Payable would be used to record:&#10;A)gross earnings of the employees.&#10;B)net earnings of the employees not paid.&#10;C)cumulative earnings of the employees&#10;D)the paid portion of the earnings.

Accepted Answer

Wages and Salaries Payable is a current liability account that records the amount of net earnings a company owes to its employees but has not yet paid. This includes the employees' gross earnings minus withholdings such as taxes and deductions. Therefore, option B is the correct choice as it accurately describes the purpose of the Wages and Salaries Payable account.

Question 8

Prepaid Worker's Compensation Insurance is what type of account?&#10;A)Asset&#10;B)Expense&#10;C)Liability&#10;D)Revenue

Accepted Answer

Prepaid Worker's Compensation Insurance is an asset account because it represents payments made in advance for insurance coverage. This means the company has a future economic benefit from the payment, classifying it as an asset.

Question 9

The debit amount to Payroll Tax Expense represents:&#10;A)the employer's portion of the payroll taxes.&#10;B)the employees' portion of the payroll taxes.&#10;C)the employer's and employees' portion of the payroll taxes.&#10;D)None of the above are correct.

Accepted Answer

The debit amount to Payroll Tax Expense represents the employer's portion of the payroll taxes. This is because payroll taxes are paid by both the employer and the employee, but the employer is responsible for paying their portion.

Question 10

Great Lakes Tutoring had the following payroll information on February 28: Assume:
FICA tax rates are: OASDI 6.2% on a limit of $106,800 and Medicare 1.45%
State Unemployment tax rate is 2% on the first $7,000
Federal Unemployment tax rate is 0.8% on the first $7,000
Using the information above, the journal entry to record the employee's tax expense would include:

A)a debit to Payroll Tax Expense in the amount of $4,000.
B)a debit to Wages and Salaries Expense in the amount of $4,000.
C)a credit to Cash in the amount of $4,000.
D)a credit to FUTA Payable for $24.

Accepted Answer

The answer of Great Lakes Tutoring had the following payroll...

Question 11

Which of the following statements is false?&#10;A)Payroll Tax Expense is an expense account.&#10;B)FICA-Social Security Tax Payable increases on the credit side of the account.&#10;C)Payroll Tax Expense increases on the debit side of the account.&#10;D)SUTA Tax Payable increases on the debit side of the account.

Accepted Answer

The answer of Which of the following statements is false?&#10;A)Payroll...

Question 12

What type of account is Payroll Tax Expense?&#10;A)Asset&#10;B)Liability&#10;C)Revenue&#10;D)Expense

Accepted Answer

The answer of What type of account is Payroll Tax...

Question 13

As the Prepaid Workers Compensation is recognized, the amount will transfer to:&#10;A)Workers Compensation Insurance Payable.&#10;B)Workers Compensation Insurance Expense.&#10;C)Cash.&#10;D)Payroll Tax Expense.

Accepted Answer

The answer of As the Prepaid Workers Compensation is recognized,...

Question 14

The Wages and Salaries Expense account would be used to record:&#10;A)net earnings for the office workers.&#10;B)a credit to the amount owed to the office workers.&#10;C)gross earnings for the office workers.&#10;D)a debit for the amount of net pay owed to the office workers.

Accepted Answer

The answer of The Wages and Salaries Expense account would...

Question 15

The account for Payroll Tax Expense includes all of the following except:&#10;A)federal unemployment taxes.&#10;B)FICA taxes (OASDI and Medicare)paid by the employer for the latest payroll period.&#10;C)state unemployment taxes.&#10;D)federal income tax.

Accepted Answer

The answer of The account for Payroll Tax Expense includes...

Question 16

The information needed to make the journal entries to record the wages and salaries expense comes from:&#10;A)form W-2.&#10;B)the look-back period.&#10;C)the payroll register.&#10;D)form 941.

Accepted Answer

The answer of The information needed to make the journal...

Question 17

What is debited if State Unemployment Tax Payable (SUTA)is credited?&#10;A)Payroll Tax Expense&#10;B)Cash&#10;C)Salaries Payable&#10;D)Salaries Expense

Accepted Answer

The answer of What is debited if State Unemployment Tax...

Question 18

Payroll Cash is a(n):&#10;A)revenue.&#10;B)liability.&#10;C)asset.&#10;D)expense.

Accepted Answer

The answer of Payroll Cash is a(n):&#10;A)revenue.&#10;B)liability.&#10;C)asset.&#10;D)expense....

Question 19

The employer's total FICA, SUTA, and FUTA tax is recorded as:&#10;A)a debit to Payroll Tax Expense.&#10;B)a credit to Payroll Tax Expense.&#10;C)a credit to Payroll Tax Payable.&#10;D)a debit to Payroll Tax Payable.

Accepted Answer

The answer of The employer's total FICA, SUTA, and FUTA...

Question 20

Grammy's Bakery had the following information for the pay period ending June 30: Assume:
FICA-OASDI applied to the first $106,800 at a rate of 6.2%.
FICA-Medicare applied at a rate of 1.45%.
FUTA applied to the first $7,000 at a rate of 0.8%.
SUTA applied to the first $7,000 at a rate of 5.6%.
State income tax is 3.8%.
Given the above information, what would be the amount applied to Office Salaries Expense?

A)Debit $550
B)Credit $550
C)Debit $500
D)Credit $500

Accepted Answer

The answer of Grammy's Bakery had the following information for...

Question 21

The balance in the Wages and Salaries Expense account is equal to net pay.

Accepted Answer

The answer of The balance in the Wages and Salaries...

Question 22

Prepare a general journal payroll entry for Advanced Computer Programming using the following information:

Assume the following:
a)FICA: OASDI, 6.2% on a limit of $106,800; Medicare, 1.45%
b)Federal income tax is 15% of gross pay
c)Each employee pays $20 per week for medical insurance

Accepted Answer

The answer of Prepare a general journal payroll entry for...

Question 23

The payroll tax expense is recorded at the same time the payroll is recorded.

Accepted Answer

The answer of The payroll tax expense is recorded at...

Question 24

Payroll information for Kinzer's Interior Decorating for the first week in October is as follows:

Taxable earnings for FICA-

Taxable earnings subject to Federal and State Unemployment taxes: $5,000
Assume the following tax rates:

Required: Prepare the payroll tax expense entry.

Accepted Answer

The answer of Payroll information for Kinzer's Interior Decorating for...

Question 25

The employer records deductions from the employee's paycheck:&#10;A)as debits to expense accounts.&#10;B)as credits to liability accounts until paid.&#10;C)as debits to asset accounts until paid.&#10;D)as credits to capital accounts.

Accepted Answer

The answer of The employer records deductions from the employee's...

Question 26

Why would a company use a separate payroll cash account?&#10;A)Provides for better internal control&#10;B)Ease of account reconciliation&#10;C)Determine whether or not the employee has cashed their check&#10;D)All of the above are correct.

Accepted Answer

The answer of Why would a company use a separate...

Question 27

Using the information provided below, prepare a journal entry to record the payroll tax expense for Mr. B's Carpentry.

Assume:
FICA tax rates are: OASDI 6.2% on a limit of $106,800 and Medicare 1.45%
State unemployment tax rate is 2% on the first $7,000
Federal unemployment tax rate is 0.8% on the first $7,000.

Accepted Answer

The answer of Using the information provided below, prepare a...

Question 28

FIT Payable has a credit normal balance.

Accepted Answer

The answer of FIT Payable has a credit normal balance....

Question 29

There is no limit on the amount of taxes paid for SUTA.

Accepted Answer

The answer of There is no limit on the amount...

Question 30

An employer must always use a calendar year for payroll purposes.

Accepted Answer

The answer of An employer must always use a calendar...

Question 31

Mike's Door Service's payroll data for the second week of June included the following:

Taxable earnings for FICA:

Taxable earnings for state unemployment taxes $2,000
Assume the following tax rates:

Required: Prepare the payroll tax expense entry.

Accepted Answer

The answer of Mike's Door Service's payroll data for the...

Question 32

What liability account is reduced when the employees are paid?&#10;A)Payroll Taxes Payable&#10;B)Federal Income Taxes Payable&#10;C)Wages and Salaries Payable&#10;D)Wages and Salaries Expense

Accepted Answer

The answer of What liability account is reduced when the...

Question 33

FICA taxes are levied only on employees.

Accepted Answer

The answer of FICA taxes are levied only on employees....

Question 34

The entry to record the payment of taxes withheld from employees and FICA taxes would be to:&#10;A)credit Cash; debit FICA-Social Security Payable, FICA-Medicare Payable, and Federal Income Tax Payable.&#10;B)debit Cash; credit FICA-Social Security Payable, FICA-Medicare Payable, and Federal Income Tax Payable.&#10;C)credit Cash; credit FICA-Social Security Payable, FICA-Medicare Payable, and Federal Income Tax Payable.&#10;D)None of these answers are correct.

Accepted Answer

The answer of The entry to record the payment of...

Question 35

Record in the general journal the payroll tax entry for the week ended August 31. Use the following information gathered to make the entry.

a)FICA tax rate is: OASDI 6.2% on a limit of $106,800, and Medicare is 1.45%
b)Federal Unemployment is 0.8% on a limit of $7,000
c)State Unemployment is 2% on a limit of $7,000

Accepted Answer

The answer of Record in the general journal the payroll...

Question 36

When a business starts, what must it obtain that identifies itself to the government?&#10;A)State Employment Number&#10;B)Federal Unemployment Number&#10;C)Employer Identification Number&#10;D)A look-back period

Accepted Answer

The answer of When a business starts, what must it...

Question 37

Sweetman's Recording Studio payroll records show the following information:

Assume the following:
a)FICA: OASDI, 6.2% on a limit of $106,800; Medicare, 1.45%
b)Each employee contributes $40 per week for union dues
c)State income tax is 5% of gross pay
d)Federal income tax is 20% of gross pay
Prepare a general journal payroll entry.

Accepted Answer

The answer of Sweetman's Recording Studio payroll records show the...

Question 38

Using the information below, determine the amount of the payroll tax expense for B. Harper Company's first payroll of the year. In your answer list the amounts for FICA (OASDI and Medicare), SUTA, and FUTA.

Assume:
FICA tax rates are: OASDI 6.2% on a limit of $106,800 and Medicare 1.45%
State Unemployment tax rate is 5.0% on the first $7,000
Federal Unemployment tax rate is 0.8% on the first $7,000

Accepted Answer

The answer of Using the information below, determine the amount...

Question 39

Form 941 taxes include OASDI, Medicare, and federal unemployment tax.

Accepted Answer

The answer of Form 941 taxes include OASDI, Medicare, and...

Question 40

If Wages and Salaries Payable is debited, what account would most likely be credited?&#10;A)Cash&#10;B)Wages and Salaries Expense&#10;C)Payroll Expense&#10;D)SUTA Payable

Accepted Answer

The answer of If Wages and Salaries Payable is debited,...

Question 41

Prepare the general journal entry to record the payroll.
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________

Accepted Answer

The answer of Prepare the general journal entry to record...

Question 42

Businesses will make their payroll tax deposits based on payroll taxes collected.

Accepted Answer

The answer of Businesses will make their payroll tax deposits...

Question 43

The correct journal entry to record the payment of FUTA is to:&#10;A)debit Cash; credit FUTA Payable.&#10;B)debit FUTA Expense; credit Cash.&#10;C)debit FUTA Payable; credit Cash.&#10;D)debit Cash; credit FUTA Expense.

Accepted Answer

The answer of The correct journal entry to record the...

Question 44

The tax paid by the employer for both the employee and employer:&#10;A)must be deposited in an authorized depository.&#10;B)must be deposited directly in the company's checking account.&#10;C)can be paid when the company is determined to have excess cash.&#10;D)None of these answers are correct.

Accepted Answer

The answer of The tax paid by the employer for...

Question 45

The correct journal entry to record the payment of SUTA is:&#10;A)debit SUTA Expense; credit Cash.&#10;B)debit Cash; credit SUTA Expense.&#10;C)debit Cash; credit SUTA Payable.&#10;D)debit SUTA Payable; credit Cash.

Accepted Answer

The answer of The correct journal entry to record the...

Question 46

The journal entry to record the estimated advance premium payment for workers' compensation is:&#10;A)  &#10;B)  &#10;C)  &#10;D)

Accepted Answer

The answer of The journal entry to record the estimated...

Question 47

Compute the total state income tax. ________

Accepted Answer

The answer of Compute the total state income tax. ________...

Question 48

Compute the employers payroll tax. ________

Accepted Answer

The answer of Compute the employers payroll tax. ________...

Question 49

The look-back period is used to determine whether:&#10;A)a business should make its Form 941 tax deposits on a monthly or semiweekly basis.&#10;B)an employer will use Form 940.&#10;C)an employer has sent the W-2s to their employees on timely basis.&#10;D)an employer must pay unemployment taxes.

Accepted Answer

The answer of The look-back period is used to determine...

Question 50

A monthly depositor:&#10;A)is an employer who only has to deposit Form 941 taxes on the 15th day of the month (or next banking day).&#10;B)is determined by the amount of Form 941 taxes that they paid in the prior year.&#10;C)will remain a monthly depositor, once classified, for one year at which time they will be reevaluated.&#10;D)All of the above answers are correct.

Accepted Answer

The answer of A monthly depositor:&#10;A)is an employer who only...

Question 51

Compute the net pay. ________

Accepted Answer

The answer of Compute the net pay. ________...

Question 52

Compute the total federal income tax. ________

Accepted Answer

The answer of Compute the total federal income tax. ________...

Question 53

Prepare the general journal entry to record the employer's payroll tax expense.
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________
___________________________________________ _________ _________

Accepted Answer

The answer of Prepare the general journal entry to record...

Question 54

Different deposit rules apply to employers based on the amount collected and owed by that employer.

Accepted Answer

The answer of Different deposit rules apply to employers based...

Question 55

Compute the total deductions. ________

Accepted Answer

The answer of Compute the total deductions. ________...

Question 56

Workers' Compensation Insurance is:&#10;A)paid by the employer to protect the employee against job-related injury or death.&#10;B)paid by the employee to protect himself/herself against job-related accidents or death.&#10;C)paid by the employer to protect the employee against non job-related injury or death.&#10;D)paid by the employee to protect himself/herself against non job-related accidents and death.

Accepted Answer

The answer of Workers' Compensation Insurance is:&#10;A)paid by the employer...

Question 57

FUTA taxes are paid:&#10;A)by the end of January of the following year if the amount owed is less than $500.&#10;B)by the end of the month following the end of the calendar quarter if the amount owed is more than $500.&#10;C)at the same time as the Form 941 taxes.&#10;D)Both A and B are correct.

Accepted Answer

The answer of FUTA taxes are paid:&#10;A)by the end of...

Question 58

Why are all of the employer payroll taxes listed in separate payable accounts?

Accepted Answer

The answer of Why are all of the employer payroll...

Question 59

Why are the employee deductions recorded as payables on the employer's books?

Accepted Answer

The answer of Why are the employee deductions recorded as...

Question 60

A calendar quarter is made up of:&#10;A)4 months.&#10;B)13 weeks.&#10;C)12 weeks.&#10;D)however many weeks are needed to complete the month.

Accepted Answer

The answer of A calendar quarter is made up of:&#10;A)4...

Question 61

Kristi's Mentoring had the following information for the pay period ending September 30:

FICA-OASDI applied to the first $106,800 at a rate of 6.2%
FICA-Medicare applied at a rate of 1.45%
FUTA applied to the first $7,000 at a rate of 0.8%
SUTA applied to the first $7,000 at a rate of 5.6%
State income tax is 3.8%
Employees contribute to their retirement fund at a rate of 5.5% of their gross earnings.
Compute the total gross earnings for the office. _________

Accepted Answer

The answer of Kristi's Mentoring had the following information for...

Question 62

Kristi's Mentoring had the following information for the pay period ending September 30:

FICA-OASDI applied to the first $106,800 at a rate of 6.2%
FICA-Medicare applied at a rate of 1.45%
FUTA applied to the first $7,000 at a rate of 0.8%
SUTA applied to the first $7,000 at a rate of 5.6%
State income tax is 3.8%
Employees contribute to their retirement fund at a rate of 5.5% of their gross earnings.
Compute the total gross earnings for the office. _________

Accepted Answer

The answer of Kristi's Mentoring had the following information for...

Question 63

Estimate the annual advance premium for workers' compensation insurance, and record it in general journal form using the following data:&#10;

Accepted Answer

The answer of Estimate the annual advance premium for workers'...

Question 64

From the following data, calculate the estimate annual advance premium for workers' compensation insurance and record it in general journal form.&#10;

Accepted Answer

The answer of From the following data, calculate the estimate...

Deck 8: Paying, Recording, and Reporting Payroll and Payroll Taxes: the Conclusion of the Payroll Process