MORT 165 Test 3
In reconciling a bank statement, the bank statement balance is $1,000 and the balance per books is $1,205. A bank service charge is $5; a deposit in transit totals $500, and outstanding checks total $300. The adjusted bank balance and book balance is
$1,200.
Gross earnings this pay period total $75,000. If the current total FUTA tax and SUTA tax rate is 5.5% for the business due to the current merit rating, and the total payroll for employees who have earnings under the $7,000 ceiling totals $23,500, what will be the employer's total unemployment tax obligation for this pay period?
$1,292.50
According to the assumption used in this text, employers are required to withhold Social Security taxes on the first ____ of each employee's earnings.
$110,100
The Social Security rate is 6.2% with a ceiling of $106,800, and the Medicare Tax rate is 1.45% with no ceiling. The single employee of the business has earned $106,600 to date. The employee's gross earnings this pay period total $7,000. What will be the total amount of Social Security tax and Medicare tax that will be withheld from this employee's gross earnings?
$113.90
Jillian Diaz receives a regular salary of $1,500 a month and is entitled to overtime pay at the rate of one and one-half times the regular hourly rate for any time worked in excess of 40 hours per week. Diaz's overtime pay rate is
$12.98.
A petty cash fund of $200 has $17 in cash, $180 in petty cash vouchers, and $3 in miscellaneous receipts not included with the petty cash vouchers. The debit to the Cash Short and Over would be
$183
The payroll register for the week ended April 15 for Ultimate Tanning Spa indicates gross earnings of $4,000 and total deductions of $1,200. The journal entry for the payroll for this week would include which of the following credit amounts to Cash?
$2,800
Sandra Wilson is paid one and one-half times the regular hourly rate for all hours worked in excess of 40 hours per week and double time for work on Sunday. Wilson's regular rate is $10 per hour. During the week ended July 3, she worked 9 hours each day from Monday through Friday, 6 hours on Saturday, and 4 hours on Sunday. Wilson's overtime earnings for the week ended July 3 are
$245.
An employee who earns $6.00 per hour for a 40-hour work week has worked 45 hours this week. All overtime hours are compensated at 1.5 times the regular hourly rate. What are the gross earnings of this employee?
$285
The gross earnings of the employee is $550. If the employee has withholdings of federal, state, and FICA taxes totaling $150, a credit union payment of $60, and medical and life insurance premiums of $35, the employee's net pay will be:
$305
The payroll register for the week ended February 14 for Luxury Homes Construction Company indicates gross earnings of $4,000 and total deductions of $1,200. The entry for the Wages and Salaries Expense ending February 14 would be a
$4,000 debit.
The payroll register for the week ended May 28 for J & D United indicates gross earnings of $4,000 and total deductions of $1,200. The total of all the credit entries for the payroll for the week ending May 28 would be
$4,000.
A self-employment tax is required of an individual who owns his or her own business and makes
$400 or more.
The petty cash payments record indicates classified expenditures as follows: Automobile Expense, $20; Supplies Expense, $12; Postage Expense, $6; and Miscellaneous Expense, $5. The journal entry to replenish the petty cash fund would include a credit to Cash for
$43.
Melissa Taylor has gross earnings of $425 and withholdings of $26.35 for Social Security tax, $6.16 for Medicare tax, and $35 for federal income tax. Her employer pays $26.35 for Social Security tax, $6.16 for Medicare tax, $3 for FUTA tax, and $9 for SUTA tax. The total cost of Melissa to her employer is
$469.51.
Cameron Tiller is paid one and one-half times the regular hourly rate for all hours worked in excess of 40 hours per week and double time for work on Sunday. Tiller's regular rate is $12 per hour. During the week ended March 15, he worked 9 hours each day from Monday through Friday, 6 hours on Saturday, and 4 hours on Sunday. Tiller's total regular earnings for the week ended March 15 are
$480.
Joel Trump is paid one and one-half times the regular hourly rate for all hours worked in excess of 40 hours per week and double time for work on Sunday. Trump's regular rate is $8 per hour. During the week ended October 10, he worked 9 hours each day from Monday through Friday, 6 hours on Saturday, and 4 hours on Sunday. Trump's total earnings for the week ended October 10 are
$516.
Ceilings for both SUTA and FUTA taxes are currently
$7,000.
Denise Cruz receives a regular salary of $900 a month and is entitled to overtime pay at the rate of one and one-half times the regular hourly rate for any time worked in excess of 40 hours per week. Cruz's overtime rate of pay is
$7.79.
The federal portion of the 6.2% federal unemployment tax rate is:
0.8%
Deposits of federal withholdings, Social Security taxes and Medicare taxes may be made using Form
8109.
Each check should be identified by its
ABA number.
The account that should be credited for the total income tax withheld from employee's earnings is
Employee Income Tax Payable.
Form W-4 is a(n)
Employee's Withholding Allowance Certificate
Form 941 is a(n)
Employer's Quarterly Federal Tax Return.
Which of the following is a payroll tax normally paid by both the employee and the employer?
FICA tax
By law, federal taxes must be withheld from the gross earnings of employees. These taxes are:
FICA, Medicare, and Federal Income Tax
The law that sets the minimum wage and the 40-hour work week is the:
Fair Labor Standards Act
The act that requires most employers to withhold certain amounts from employees' earnings for contributions to the Social Security and Medicare programs is called the
Federal Insurance Contributions Act.
Employers may deposit Social Security and Medicare taxes at a Federal Reserve Bank or other authorized commercial bank using
Form 8109.
The transmittal of wage and tax statement, due the last day of February along with copy A of each employees W-2 form, is called a:
Form W-4
An employee worked a total of 56 hours for a 7 day week, working 8 hours on Saturday at time-and-one-half, and 8 hours on Sunday at double time.
If the employee is paid a regular wage of $8.00 per hour, the gross earnings for the period will total $544.
An Employer Identification Number (EIN) is obtained by the employer from the
Internal Revenue Service.
A check written for $43.00 was entered in the records with a credit to the Cash account for $34.00.
On the bank reconciliation, the correction of the error will require an additional $9.00 deduction to the checkbook cash balance.
To use an ATM machine, the depositor must have a
PIN #
The account that is credited with amounts withheld from an employee's earnings for any pension plan contribution is
Pension Plan Deductions Payable.
Which of the following tax programs often has a merit-rating system to encourage employers to provide regular employment for workers?
SUTA
The account that is credited for the Social Security tax withheld from employee's earnings and the Social Security tax imposed on the employer is
Social Security Tax Payable.
In preparing the bank reconciliation, it is discovered that a check for the $87.00 telephone bill was written correctly for that amount but listed in error in the journal at $78.00.
This error will require a journal entry to correct the balance of the Cash account.
Each employee is required to furnish the employer with which of the following forms?
W-4
The account that is debited for the total amount of the gross earnings of all employees for each pay period is
Wages and Salaries Expense.
The employer usually pays the entire cost of
Workers' Compensation Insurance.
To complete transactions with the bank, electronic funds transfer (EFT) systems use
a computer.
The bookkeeper recorded a payment by check for the purchase of store supplies as a debit to Store Supplies and a credit to Cash for $1,340.56. The check was recorded by the bank at its correct amount of $3,140.56. Prior to the preparation of the bank reconciliation, the error would cause:
a possibility that the checking account might become overdrawn.
The proper treatment of a deposit recorded by the business but not yet recorded by the bank is to report the deposit on the bank reconciliation as a(n):
addition to the balance per bank statement.
The proper treatment on a bank reconciliation of a note receivable collected for the firm by the bank is to show the note as a(an):
addition to the book balance per checkbook.
Generally employers are required to withhold federal taxes from the gross earnings of employees. The amount withheld may be determined by each of the following items except:
age of the employee.
The bank statement for a checking account normally shows the
amount of deposits and other credits added during the period.
To reconcile the bank statement, which of the following amounts would be added to the bank statement balance?
amounts collected by the bank for the depositor's account
An endorsement consisting only of a depositor's name stamp or signature is called a:
blank endorsement.
The cash register cash count totals $5,102. The cash register sales tape reports sales for the day of $5,103. As a result of these totals, there is a:
cash shortage of $1.00.
Cash Sales from the cash register tapes totaled $882. There is a change fund of $100. The cash count indicates that $984 is in the cash drawer. What journal entry would be required?
debit Cash for $884; credit Revenues for $882, and Cash Short and Over for $2
When a single-check for payroll is prepared and deposited into a special payroll bank account, which of the following entries is made to record the deposit?
debit Payroll Cash; credit Cash
The proper entry to establish a Petty Cash fund is to
debit Petty Cash and credit Cash
To journalize the payment of Social Security taxes to the IRS, the correct entry would be
debit Social Security Tax Payable and credit Cash.
The adjustment to journalize an additional premium due at the end of the year for workers' compensation insurance (WCI) is
debit WCI Expense and credit WCI Payable.
The petty cash payments record indicates classified expenditures as follows: Automobile Expense, $20; Supplies Expense, $12; Postage Expense, $6; and Miscellaneous Expense, $5. The transaction would include
debiting Automobile Expense.
Whenever the bank mails a credit memo to the depositor indicating the amount of interest credited to the account, the transaction that would be entered in the accounting records of the depositor would include
debiting Cash and crediting Interest Earned.
In reconciling a bank statement, the bank statement balance is $1,000 and the balance per books is $1,205. A bank service charge is $5; a deposit in transit totals $500; and outstanding checks total $300. The journal entry for a bank service charge would include
debiting Miscellaneous Expense and crediting Cash
On a bank reconciliation, deposits that were not entered by the bank before the bank statement was prepared are known as
deposits in transit.
A check involves three parties. The bank in which the drawer has money on deposit is called the
drawee.
A check involves three parties. The person who orders the bank to pay a certain amount of money is called the
drawer.
A separate record of each employee's earnings is called a(n)
employee earning record.
Which of the following items is not a tax on the employer?
employee income tax.
The federal unemployment tax is levied on
employees and is deducted from employees' earnings.
The FUTA tax is more commonly known as the:
federal unemployment tax.
Which of the following is never a deduction from the gross earnings of an employee?
federal unemployment tax.
Which of the following items may not be a cost to employ a person?
health insurance.
Check No. 450, a payment of $45 for the telephone bill, was incorrectly entered on the check stub as $54. Which of the following adjustments needs to be made?
increase the book balance
Any person who agrees to perform a service for a fee and is not subject to the control of those for whom the service is performed is called a(n)
independent contractor.
Self-employment income is the net income of a trade or business run by an
individual.
In many states, those employers who have very few layoffs and few claims for unemployment benefits receive a
merit rating.
Employers who have less than $2,500 due in federal income tax withholding and Social Security and Medicare taxes at the end of the quarter should journalize the debt and pay at the end of the
month following the end of the quarter.
A debit to Accounts Receivable for $50 and a credit to Cash for $50 would be an accurate journal entry to record
not sufficient funds (NSF) checks.
The Petty Cash cashier reported the following Petty Cash receipts: office supplies, $30.00; store supplies, $19.00; and cash left in the petty cash box, $.50. The Petty Cash account has a $50.00 balance. The entry to replenish the Petty Cash is:
office supplies, dr. $30.00; Store Supplies, dr. $19.00; Cash Short and Over, dr. $.50; Cash, cr. $49.50
The Fair Labor Standards Act provides which of the following minimum rates to be paid to employees for all hours worked over 40 hours per week?
one and one-half times the regular rate
On a bank reconciliation, checks issued during the period that were not presented to the bank for payment before the bank statement was prepared are known as
outstanding checks.
A check involves three parties. The person directed to receive the money is called the
payee
A business with several employees on the payroll should maintain as a feature of good cash control a special:
payroll checking account.
A key source of information for computing employer payroll taxes is the
payroll register
The total earnings-to-date information for each employee will be found in the:
payroll register and employee's earnings record
Employers usually prepare which of the following types of payroll records?
payroll register, employee earnings record, and payroll check
A multi-column form used to assemble, compute, and summarize data for all employees at the end of the payroll period is a(n)
payroll register.
A special multi-column record that supplements the regular accounting records and from which no posting is done is called a
petty cash payment record.
A special form of receipt showing the name of the payee, the purpose of the payment, and the account to be charged for each petty cash payment is known as a
petty cash voucher.
Examples of employees include all of the following EXCEPT
public accountants.
The process of bringing the book and the bank balance into agreement is called
reconciling the bank statement.
To sign the back of a check with the name of the company and "Pay to any bank" is an example of a
restrictive endorsement.
Compensation normally expressed in biweekly, monthly, or annual terms for managerial or administrative services is called
salary.
To reconcile the bank statement, which of the following amounts would be subtracted from the checkbook balance?
service charge
Which of the following would require a debit to the Petty Cash account?
the Petty Cash account is being increased
The cost of workers' compensation insurance for the employer depends on all of the following EXCEPT
the amount of FICA, FUTA, and SUTA taxes due.
When a bank reduces the depositor's checking account for service charges or check printing charges,
the bank debits the depositor's account with the bank.
The business or person upon whose account a check is drawn is called:
the drawer.
The employer pays which of the following to the Internal Revenue Service?
the employer's Social Security and Medicare taxes
If the Petty Cash fund is not replenished at the end of the accounting reporting period,
the income statement and the balance sheet will not be correct.
For effective cash control
the petty cash cashier will use a voucher system.
The outputs from a manual or an electronic payroll accounting system include all of the following EXCEPT
time cards.
A business that has few claims for unemployment payments against their account
will have a low experience-rating and pay a lower amount for unemployment taxes.
An amount of an employee's gross pay which is exempt from federal income tax withholding is a(n)
withholding allowance