Question 1

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

Accepted Answer

The individual employee earnings record includes details such as hours worked, withholding taxes, and net pay, but it does not typically include allowances, which are part of the tax forms employees fill out to determine withholding amounts.

Question 2

Carla's cumulative earnings before this pay period were $5,320, 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

Since Carla's cumulative earnings before this pay period were $5,320 and her gross pay for the week is $600, her total earnings would be $5,920 ($5,320 + $600), which is below the wage base limit of $7,000. Therefore, the entire $600 of this week's pay is subject to taxes for SUTA and FUTA.

Question 3

Unemployment taxes are:

Accepted Answer

Unemployment taxes are indeed based on wages paid to employees and can also vary depending on an employer's history of claims, meaning both A and B are correct.

Question 4

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 5

Greg's Auction House's payroll for April includes the following data:  What is the employee's portion of the taxes? (Round any intermediate calculations to the nearest cent, and your final answer to the nearest whole dollar.)

Accepted Answer

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

Question 6

Prepaid Workers' Compensation Insurance is what type of account?

Accepted Answer

Prepaid Workers' Compensation Insurance is considered an asset because it represents a future economic benefit to the company, as the payments have been made in advance for insurance coverage that will be provided over time.

Question 7

Workers' compensation:

Accepted Answer

All of the options correctly describe aspects of workers' compensation: it provides insurance for employees against job-related injuries or death (A), its cost is based on the company's total estimated gross payroll (B), and it is funded by the employer (C).

Question 8

Compute the net pay for each employee listed below. Assume the following rates: FICA-OASDI 6.2% on a limit of $128,400; Medicare is 1.45%; federal income tax is 20%; state income tax is 5%; and union dues are $20.

Accepted Answer

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

Question 9

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

Accepted Answer

Both FICA taxes and unemployment taxes are considered payroll tax expenses for the employer, as they are required to contribute to these taxes based on employee wages.

Question 10

Bob's Auction House's payroll for April includes the following data:  What is the employer's portion of the taxes? (Round intermediary calculations to the nearest cent and final answers to the whole dollar.)

Accepted Answer

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

Question 11

An employee has gross earnings of $1,100 and withholdings of $60 FICA (OASDI and Medicare), and $50 for income taxes (FIT and SIT). The employer pays $60 FICA (OASDI and Medicare), $14 for SUTA, and $5.60 FUTA. What is the employer's total cost of the employee? (Round any intermediate calculations to the nearest cent, and your final answer to the nearest whole dollar.)

Accepted Answer

The answer of An employee has gross earnings of $1,100...

Question 12

Most employers are levied a payroll tax for:

Accepted Answer

Most employers are subject to payroll taxes that include FICA taxes (which fund Social Security and Medicare) as well as federal and state unemployment taxes. These taxes are part of the employer's responsibility to contribute to the social safety nets and unemployment insurance programs.

Question 13

If the employee has $700 withheld from their check for FICA-OASDI, what is the amount that the employer would need to pay?

Accepted Answer

The employer is required to match the FICA-OASDI amount withheld from the employee's paycheck, which is $700 in this case.

Question 14

Joe's Tax Service has two types of employees, management and clerical support. The company estimates that it will pay the clerical support $510,000 next year and the managers $280,000. For every $100, the company pays $0.14 into the workers' compensation insurance. Calculate the amount of workers' compensation insurance.

Accepted Answer

The total amount paid to employees is $510,000 + $280,000 = $790,000. The amount of workers' compensation insurance is $790,000 x 0.14 = $1,106.

Question 15

If the employee has $700 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

Employers do not pay a portion of an employee's federal income tax; the amount withheld from the employee's paycheck goes entirely to the government.

Question 16

The payroll taxes the employer is responsible for are:

Accepted Answer

Employers are responsible for paying both FICA-OASDI (Social Security) and FICA-Medicare taxes. State income taxes are typically withheld from the employee's wages and are not the employer's responsibility in the same way.

Question 17

Barbara's cumulative earnings before this pay period were $7,600 and gross pay for the week is $800. 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

Since Barbara's cumulative earnings before this pay period were $7,600, which is already above the wage base limit of $7,000, none of this week's pay of $800 is subject to taxes for FUTA and SUTA.

Question 18

Both employees and employers pay which of the following taxes?

Accepted Answer

FICA taxes, which include Social Security (OASDI) and Medicare taxes, are paid by both employees and employers.

Question 19

A calendar quarter consists of:

Accepted Answer

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

Question 20

Bill's Auction House's payroll for June includes the following data:  What is the gross pay?

Accepted Answer

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

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