Accounting chapter 8,9 cengage

Employers are required by the Fair Labor Standards Act to pay overtime at 1½ times their regular hourly rate to any hourly employee who works a.over 40 hours in a week. b.over 30 hours in a week, but under 40 hours. c.over 35 hours in a week. d.over 37.5 hours in a week, not including lunch.

A

Which of the following is a type of compensation that is expressed in biweekly, monthly, or annual terms? a.Salary b.Pay rate c.Wages d.Hourly rate

A

For better internal accounting control, payment by check or ____________ provides better internal accounting control than payment by cash. a.prepaid bank card b.Venmo c.direct deposit d.earnings transfer

C

Which of the following forms is sent by employers, along with Copy A of Forms W-2, to the Social Security Administration by January 31? a.W-4 b.10K c.W-3 d.8K

C

All of the following are commonly used by employers to accumulate individual employee payroll information, except a.the payroll check with earnings statement attached. b.the employee earnings record. c.the payroll register. d.federal withholding tax tables.

D

All of the following are employer payroll reporting forms except a.Employment eligibility verification (Form I-9). b.Summary of employee wages and taxes (Form W-3). c.Employee Wage and Tax Statement (Form W-2). d.Income tax return (Form 1040-EZ).

D

All of the following are examples of voluntary deductions from employee earnings except a.credit union deposits. b.pension plan payments. c.health insurance premiums. d.Medicare tax.

D

All of the following contribute to the overall cost of workers' compensation insurance except the a.company's accident history. b.riskiness of the job. c.number of employees. d.education level of employees.

D

During the first week of January, Nora Taylor earned $800. FICA taxes are 7.65% of wages, SUTA is 5.4% of earnings to the maximum allowed, FUTA is 0.6% of earnings to the maximum allowed, and federal and state income tax withholdings are $72 and $24, respectively. Assuming that Nora is the only employee for the Ice is Nice Jewelry store, what is the total employer's tax expense for the first week of January? a.$104.40 b.$48.00 c.$43.20 d.$109.20

D

During the first week of March, Ryan Owens earned $800. Assume a Social Security tax rate of 6.2%; a Medicare rate of 1.45%; and that federal and state income tax withholdings are $65 and $24, respectively. Assume that Ryan has voluntary withholdings of $40 for savings. What amount did Ryan receive in his check, net of all deductions, for the week's pay? a.$738.80 b.$649.80 c.$673.80 d.$609.80

D

Employee Federal Income Tax Payable, Social Security Tax Payable, and Medicare Tax Payable are all classified as what type of accounts? a.Assets b.Expenses c.Owner's equity d.Liabilities

D

For payroll purposes, what is the distinction between an employee and an independent contractor? a.Employees receive benefits, while independent contractors pay less in taxes. b.Some employees require paid time off, while independent contractors do not. c.Independent contractors don't receive any form of retirement investing options. d.Government laws and regulations regarding payroll are much more complex for employees than for independent contractors.

D

For the month of February, Lisa Steele earned $3,000. Lisa has been on the payroll since January 1 at a salary of $3,000 per month, which is paid at the end of the month. FICA taxes are 7.65% of wages, SUTA is 5.4% of earnings to the maximum allowed, FUTA is 0.6% of earnings to the maximum allowed, and federal and state income tax withholdings are $310 and $120, respectively. Lisa also has monthly health insurance premiums of $280 withheld from her earnings. Assuming that Lisa is the only employee for Dream Meals Catering, what is the total employer's tax expense for February? a.$180.00 b.$391.50 c.$689.50 d.$409.50

D

For the week ending February 28, the payroll register for Wallingford Legal Services Group reported the following data:Wages and salaries expense$33,000Employee income tax payable4,850Health insurance premiums620Earnings subject to Social Security taxes33,000Calculate the amount of Social Security and Medicare taxes to be withheld. Determine the amount that will be credited to Cash for the net pay amount. What is the appropriate journal entry for the February 28 payroll, crediting Cash for net pay? a.Debit Cash for $25,005.50 and Employee Income Tax Payable for $4,850.00 and credit Social Security Tax Payable for $2,406.00, Medicare Tax Payable for $478.50, Health Insurance Premiums Payable for $620.00, and Cash for $33,000.00. b.Debit Net Pay for $33,000.00 and credit Employee Income Tax Payable for $4,850.00, Social Security Tax Payable for $2,406.00, Medicare Tax Payable for $478.50, Health Insurance Premiums Payable for $620.00, and Cash for $25,005.50. c.Debit Wages and Salaries Expense for $33,000.00 and credit Employee Income Tax Payable for $4,850.00, Health Insurance Premiums Payable for $620.00, and Net Pay for $25,005.50. d.Debit Wages and Salaries Expense for $33,000.00 and credit Employee Income Tax Payable for $4,850.00, Social Security Tax Payable for $2,406.00, Medicare Tax Payable for $478.50, Health Insurance Premiums Payable for $620.00, and Cash for $25,005.50.

D

Hudson Transportation Service estimated that its total payroll for the coming year would be $375,000. Its workers' compensation insurance premium rate is 0.2%. What is the amount of Hudson's estimated workers' compensation insurance premium paid at the beginning of the year? a.$7,500 b.$75 c.$3,750 d.$750

D

Sam's Service Station pays its six employees on a weekly basis and utilizes a payroll register, an individual employee earnings record, and a general journal. Sam's Service uses a weekly federal income tax withholding table. Employees are paid 1½ times the regular rate for working over 40 hours per week. Social Security tax is withheld from the first $128,400 at 6.2% and Medicare tax is withheld at the rate of 1.45%.Brad Fagan, employee #6, has worked as a service attendant for the past five months, with a hire date of March 10 of the current year. He was born on February 9, 1999, and his Social Security number is 292-66-1330. Brad's address is 1007 Allendale Road, Petersburg, PA 19176. Brad is single and claims two (2) allowances.For the week ended August 15, 20--, Brad worked 46 hours. His regular hourly rate is $12.50. Brad's federal income tax withholding is $52.00 for the week.When completing an employee earnings record for Brad Fagan, what are the total earnings, taxable earnings, total deductions, and total check amount, respectively? a.$612.50; $500.00; $52.00; $448.00 b.$500.00; $612.50; $52.00; $560.50 c.$612.50; $500.00; $46.86; $565.64 d.$612.50; $612.50; $98.86; $513.64

D

The Oakdale School District employs Simon DuBois at a salary of $72,000 per year as a science teacher. Oakdale is levied employer payroll taxes at the following rates: Social Security taxes at 6.2%; Medicare taxes at 1.45%; SUTA tax at a rate of 5.4% and FUTA tax at a rate of 0.6% each on the first $7,000 of DuBois's salary. What is the total cost of employing Simon DuBois if there are no additional health care or pension expenses to Oakdale School District? a.$77,508 b.$81,828 c.$72,420 d.$77,928

D

To where are the employer's FICA taxes and the employee's Social Security and Medicare taxes withheld paid? a.Social Security Administration b.State Office of Taxation c.Federal Income Tax Service d.Internal Revenue Service

D

What effect do the Social Security, Medicare, FUTA, and SUTA taxes imposed on the employer have on owner's equity? a.Payroll taxes have no effect until they are paid. b.Payroll taxes have no net effect on owner's equity. c.Payroll taxes increase owner's equity. d.Payroll taxes decrease owner's equity.

D

When combined, the Social Security and Medicare taxes are known as the acronym a.SSMT. b.FUTA. c.SUTA. d.FICA.

D

When journalizing employer payroll taxes, Social Security, Medicare, FUTA, and SUTA taxes payable accounts are classified as which of the following types of accounts? a.Assets b.Owner's equity c.Expenses d.Liabilities

D

Which of the following accounts is debited for the gross pay of all employees? a.Employee Federal Income Tax Payable b.Wages and Salaries Payable c.Cash d.Wages and Salaries Expense

D

Which of the following is a common approach used by medium- and large-size businesses for payroll record keeping? a.An RFID b.Self-reporting c.Card scanning d.A payroll processing center

D

Which of the following is the main distinction between an employee and an independent contractor? a.Employees and independent contractors may require special training to perform their duties. b.Not all employees perform services. c.Independent contractors perform a service for a fee, like some employees. d.An employee works under the control and direction of an employer; an independent contractor does not work under the control and direction of the company paying for the service.

D

Which of the following steps is not required to determine how much to pay an employee for a pay period? a.Subtract deductions from total earning to compute net pay. b.Determine the amounts of deductions. c.Calculate total earnings. d.Determine last year's effective tax rate.

D

Which of the following systems must be used to deposit employee federal income tax withheld, Social Security tax, and Medicare tax? a.Electronic Employee Tax Deposit System (EETDS) b.Federal Electronic Tax Payment System (FETPS) c.Federal Employee Tax System (FETS) d.Electronic Federal Tax Payment System (EFTPS)

D

Which of the following taxes is levied on both employees and employers? a.Federal unemployment tax (FUTA) b.Federal income tax c.State unemployment tax (SUTA) d.Social Security tax

D

Which of the following taxes is not withheld from an employee's earnings? a.Medicare tax b.Federal income tax c.Social Security tax d.Unemployment tax

D

Which of the following taxes is paid by both the employee and the employer? a.Federal unemployment tax b.State unemployment tax c.State withholding tax d.Social Security tax

D

Which of the following types of payroll system is based on a software package? a.Payroll management b.Manual system c.Process system d.Electronic system

D

Which of the following usually pays for the cost of workers' compensation insurance? a.The employee bears the cost. b.The employer and employee each contribute equally to the cost. c.Each state bears the cost. d.The employer bears the cost.

D