Ch. 5 Employee Net Pay and Pay Methods

Pataasin ang iyong marka sa homework at exams ngayon gamit ang Quizwiz!

Court ordered garnishments can be for

child support. student loans. alimony.

Information on local (city or county) taxes can be found through

county revenue department. city revenue department.

In addition to tracking hours and accurately compensating employees based on their marital status and withholdings, the employer must keep the employee's BLANK number in a BLANK file.

paycard, secure

Payroll software packages use the BLANK method to compute income tax amounts.

percentage

Post-tax deductions

reduce employee net pay.

Until 2006, BLANK BLANK applied to funds on deposit in an FDIC-insured institution but has since been extended to paycards.

regulation e

Charitable contributions are

reported on the employee's itemized tax return. deducted post-tax.

The difference between income tax withholding amounts using wage-brack and percentage methods occurs because of BLANK during the computation process.

rounding

Employees may be subject to

state disability taxes. state income taxes.

In 2021, Social Security taxes have a maximum wage base of

$142,800

During the first step of determining grossed-up pay, what computation must occur?

Compute the total percentage of mandatory taxes

What is a potential problem when using an electronic portal for employee access to pay records?

Computer hacking

What item(s) was/were new on the Form 2020 W-4? (Check all that apply).

Dependents under 17 Multiple jobs or spouse's employment

Which controls would improve accountability in cash payroll systems?

Signed receipts

What are advantages of paying employees by check?

Simplicity of accounting records Improved traceability

Old Age Surviver Disability Insurance (OASDI) is another name for:

Social Security tax

The percentage method calculates withholding amounts based upon

tiered income level.

Unlike the use of paper checks or direct deposit for payroll disbursement, paycards do not require employees to have a BLANK BLANK

bank account

Employers withhold state taxes Based on all wages earned

based on all wages earned within their state.

Which of the following are potential indicators of payroll fraud (select all that apply)?

Absence of the bank's or the recipient's address Changes in font type Handwritten additions to the paycheck

The purpose for using grossed-up pay is to

Achieve a predetermined net pay Satisfy tax liabilities

Highly compensated employees are subject to an additional 0.9% Medicare tax because of the BLANK BLANK Act.

Affordable Care

BLANK is a type of cryptocurrency that has gained popularity.

Bitcon

Put the list in the correct processing order Instructions

Determine gross pay Determine pre-tax tax deduction Determine federal withholding taxes Determine post-tax deductions

Timing of the employee repayment of an advance is determined by:

Employee agreement

Who would be subject to additional Medicare taxes?

Employees earning more than $200,000

True or False: The wage-bracket method is useful for manual payroll preparation because the process of federal tax withholding is an absolute amount that will match the year-end tax forms.

False

Which of the following are disadvantages of paying employees by check?

Increased risk of lost pay check Increased reconciliation process

When would a company use paycards for the payment of employees?

Large number of employees that do not have bank accounts If they have traveling workers

Define escheatment.

Leaving a check uncashed

The BLANK BLANK may be liable for payroll check fraud until such activity is proven.

check issuer

FICA taxes are imposed on

eligible wages

When using the wage-bracket method the payroll accountant needs to know

exemptions. marital status.

Under the percentage method, place the items in calculation order

gross pay federal taxable wages withholding allowance deduction tiered tax rate

If a firm operates in multiple states, state BLANK BLANK requirements may become more complex.

income tax

Occupational privilege taxes may be imposed by

local governments.

Employers issuing paper checks to employees should

maintain an unclaimed property account. use a dedicated payroll account. ensure sufficient funds are in the bank account.

Employees who travel for work could find paycards

more convenient than checks. a viable option to direct deposit.

When using direct deposit, a best practice is to grant employees access to an BLANK BLANK to view their pay advice.

online portal

The repayment by an employee of an advance is treated as a BLANK-tax deduction

post

To determine taxes to withhold using the BLANK BLANK method, the payroll clerk may use Publication 15-T.

wage bracket

An employee earns $4,000 per week and contributes $150 to their 401(k) plan and $75 to United Way. What amount of employee's wages are subject to federal income taxes?

$3,850

The combined rate for Social Security taxes in 2020 is

12.4%

The combined maximum Medicare tax rate for an individual earning more than $200,000 annually would be

2.35%.

George had gross wages of $1,000, 401(k) deduction equal to 15% of gross wages and health insurance of $50. George's taxable income is $

800

True or false: Disposable income limits apply to union dues.

False

Which of the following is true about the Social Security wage base?

It usually changes annually The tax rate is 6.2% of eligible wages

Daniel is a new employee looking at contributing to a 401(k) offered through the company. How will his contributions affect his tax liability?

Lower federal income tax No change to FICA tax liability

Which of the following are types of taxes employers would match?

Medicare taxes Social Security taxes

Mandatory tax deductions for all employees include the following:

Medicare taxes federal income taxes Social Security taxes

When an employer pays with cash, what information should the pay advice contain?

Net pay Deductions Gross pay

Which of the following are NOT determinates of federal withholding taxes on Form W-4 from 2019 or prior years?

Net pay Job classification

FICA taxes comprise which of the following:

Social Security taxes. Medicare taxes.

The following is true about state taxes on employees earnings:

States tax rates may vary by wage levels. States may apply a variety of additional taxes. State taxes follow similar guidelines as federal taxes.

What are some reasons that employers may pay their employee's wages in cash?

Temporary workers High liquidity for employees

Select the specific types of employee pay that are subject to garnishments for consumer credit.

Termination pay Commissions Sign-on bonuses

An employer must withhold state income taxes when

The state in which they operate has a state income tax.

Internet technologies allow the transfer of funds for cryptocurrencies by:

Transfers between wallets International payment without exchange rates

Employees may chose to use direct deposit to

decrease wait time for access to their payroll. avoid going to the bank. avoid losing the paycheck.

The concept of BLANK BLANK is the general guideline for amounts subject to consumer credit garnishment.

personal service

After computing employee gross pay, the next step is to

subtract pre-tax deductions.

Once the employer has computed the employee's gross pay, the next step is

to deducted mandatory, voluntary, and mandated amounts.

Employee deductions for union dues are considered

voluntary

Post-tax deductions are comprised of

voluntary withholdings. mandated withholdings.

Publication 15 provides employers information on the amount of BLANK to be withheld

taxes

Social Security and Medicare can be higher than federal taxable income because of retirement contributions.

True

True or False: The new Form W-4 removes the withholding allowances and focuses on marital status, annual income, and dependents.

True

True or false: Paycards may be accessed anywhere that credit cards are accepted.

True

The employee completes which form to identify the withholding information for federal income taxes?

W-4

The wage based for the additional Medicare tax is determined by the information on the employee's

W-4

When would an employee want to have additional taxes withheld by their employer?

When the employee has additional income for which no income tax is withheld. When the employee has more than one job.

Obtaining the employee's BLANK and BLANK averts problems associated with timely cash payments.

signature, date

The employer's role in federal income taxes is: (Select all that apply).

depositor. collector. reporter.

The maximum garnishment for an employee is determined on

disposable income.

Social Security taxes were designed to cover people for:

old age disability illness retirement

Charitable contributions are

paid by the employee and remitted by the employer.


Kaugnay na mga set ng pag-aaral

Ch. 8 Workplace Law and Ethics (definitions)

View Set

MWH Questions from Reading Quizzes

View Set

Vocabulary Workshop Level D Unit 4,5,6

View Set

Moodle - BIO 106 Lab - Chapter 8 and 9

View Set

Real Estate Principles (Ch. 10 - Leases Quiz)

View Set