Question 1

Most employers are levied a payroll tax for:

Accepted Answer

Payroll tax is levied on employers to fund various social welfare programs in the US that include Social Security, Medicare, federal and state unemployment taxes. The Federal Insurance Contributions Act (FICA) combines the Social Security tax and the Medicare tax. Therefore, the most appropriate choice is C- FICA taxes, federal and state unemployment taxes.

Question 2

Compute the net pay for each employee listed below.Assume the following rates: FICA-OASDI 6.2% on a limit of $117,000;Medicare is 1.45%;federal income tax is 20%;state income tax is 5%;and union dues are $10.

Accepted Answer

The answer of Compute the net pay for each employee...

Question 3

If the employee has $800 withheld from their check for federal income tax,what is the amount that the employer would need to pay for their portion of the federal income tax?

Accepted Answer

The employer does not have to pay for their portion of the federal income tax. The $800 withheld from the employee's check goes directly towards paying their federal income tax liability.

Question 4

The individual employee earnings record provides a summary of the following for a single employee,except:

Accepted Answer

The individual employee earnings record includes information such as hours worked, gross pay, taxes withheld, and net pay. However, it typically does not include information on allowances, which are usually listed on the employee's W-4 form.

Question 5

Unemployment taxes are:

Accepted Answer

Unemployment taxes are based on the wages paid to employees, and the employer's payment history. These taxes are not the same for all employers as the rates can vary depending on the employer's history of laying off workers and causing them to receive unemployment benefits.

Question 6

An employee has gross earnings of $1000 and withholdings of $60 FICA (OASDI and Medicare),and $50 for income taxes (FIT and SIT).The employer pays $60 FICA (OASDI and Medicare),$10 for SUTA,and $5.60 FUTA.What is the employer's total cost of the employee?

Accepted Answer

The employer's total cost includes the gross earnings of $1000 plus the employer's share of FICA ($60), SUTA ($10), and FUTA ($5.60), totaling $1,075.60.

Question 7

Prepaid Worker's Compensation Insurance is what type of account?

Accepted Answer

Prepaid Worker's Compensation Insurance is an asset because it represents a prepayment for an expense that will be incurred in the future. Once the insurance is used, it will be expensed and removed from the asset section of the balance sheet.

Question 8

Karen's cumulative earnings before this pay period were $5,340,and gross pay for the week is $600.Assuming the wage base limit is $7,000,how much of this week's pay is subject to taxes for SUTA and FUTA?

Accepted Answer

The wage base limit for SUTA and FUTA is $7,000. Karen's cumulative earnings before this pay period were $5,340, so she has $1,660 of earnings remaining before she reaches the wage base limit. This week's gross pay is $600, so $550 of it is subject to taxes for SUTA and FUTA.

Question 9

The payroll taxes the employer is responsible for are:

Accepted Answer

The employer is responsible for paying both FICA-OASDI (Social Security) and FICA-Medicare taxes for their employees, making choices A and B correct. State income taxes, on the other hand, are usually withheld from an employee's paycheck and then paid directly to the state government by the employee themselves, not the employer.

Question 10

Gene's Tax Service has two types of employees,management and clerical support.The company estimates that it will pay the clerical support $500,000 next year and the managers $255,000.For every $100,the company pays $0.14 into the workers' compensation insurance.Calculate the amount of worker's compensation insurance.

Accepted Answer

The total amount paid to employees is $500,000 + $255,000 = $755,000. The amount of worker's compensation insurance is $755,000 * 0.14 = $1,057.

Question 11

FICA (OASDI and Medicare)and unemployment taxes are similar in that they:

Accepted Answer

FICA (OASDI and Medicare) and unemployment taxes are both payroll tax expenses of the employer. FICA taxes are used to fund Social Security and Medicare programs, while unemployment taxes are used to fund unemployment benefits for workers who have lost their jobs through no fault of their own. They have different maximum taxable wage bases and percentage rates. Federal income tax withholdings are separate and not a part of either FICA or unemployment taxes.

Question 12

Both employees and employers pay which of the following taxes?

Accepted Answer

Both employees and employers are required to pay FICA taxes which include the OASDI (Old Age, Survivor, and Disability Insurance) and Medicare taxes. FUTA (Federal Unemployment Tax Act) tax is solely paid by employers, while federal income tax and worker's compensation may be paid by employees or employers depending on the specific circumstances.

Question 13

Workers' compensation:

Accepted Answer

Workers' compensation insurance is a type of insurance that provides benefits to employees who have been injured on the job or who develop work-related illnesses. It is paid for by the employer and is based on the total estimated gross payroll. Therefore, all of the above options (A, B, and C) are correct.

Question 14

If the employee has $500 withheld from their check for FICA-OASDI,what is the amount that the employer would need to pay?

Accepted Answer

The employer matches the employee's FICA-OASDI contribution, so they would also pay $500.

Question 15

A calendar quarter consists of:

Accepted Answer

A calendar quarter consists of 13 weeks, which is one-fourth of a 52-week year.

Question 16

Bob's Auction House's payroll for June includes the following data:

What is the gross pay?

Accepted Answer

The answer of Bob's Auction House's payroll for June includes...

Question 17

Bob's Auction House's payroll for April includes the following data:

What is the employer's portion of the taxes?

Accepted Answer

The employer's portion of taxes includes Social Security tax (6.2% of $14,000), Medicare tax (1.45% of $14,000), and federal unemployment tax (0.6% of $14,000). Therefore, the total employer portion of taxes is $272.10 (6.2% of $14,000 + 1.45% of $14,000 + 0.6% of $14,000).

Question 18

For which of the following taxes is there a ceiling on the amount of employee annual earnings subject to the tax?

Accepted Answer

All of these taxes have a ceiling on the amount of employee annual earnings subject to the tax. Federal and State unemployment taxes have a wage base limit beyond which earnings are not taxed. Similarly, FICA-OASDI (Social Security) also has a wage base limit that is adjusted annually for inflation.

Question 19

Shelly's cumulative earnings before this pay period were $7,200 and gross pay for the week is $1,000.Assuming the wage base limit is $7,000,how much of this week's pay is subject to taxes for FUTA and SUTA?

Accepted Answer

The wage base limit for FUTA and SUTA is $7,000. Shelly's cumulative earnings before this pay period were $7,200, so she has already reached the wage base limit. Therefore, none of this week's pay is subject to taxes for FUTA and SUTA.

Question 20

Bob's Auction House's payroll for April includes the following data:

What is the employee's portion of the taxes?

Accepted Answer

The answer of Bob's Auction House's payroll for April includes...

Quiz 7: Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process