CHAP 7 ACCT

Lisa's cumulative earnings before this pay period were $7,400 and gross pay for the week is $1,300. Assuming the wage base limit is $7,000, how much of this week's pay is subject to taxes for FUTA and SUTA?

$0

Mary's cumulative earnings before this pay period were $7,300 and gross pay for the week is $1,200. Assuming the wage base limit is $7,000, how much of this week's pay is subject to taxes for FUTA and SUTA?

$0 Mary's cumulative earnings before this pay period were $7,300, which means she has already met the limit and no additional FUTA or SUTA must be paid.

K. Jones is paid every two weeks. During a recent pay period, she worked 48 hours in week 1 and 40 hours in week 2. Her regular hourly rate is $15 and she is paid 1.5 times that rate for overtime hours. A regular workweek is 40 hours. What is her gross pay?

$1,380

Compute net earnings on June 15, when gross (taxable) pay equals $2,500. FICA-OASDI tax rates are 6.2%, FICA-Medicare rate is 1.45%, federal income tax $625.00, and state income tax $125.00.

$1,558.75

For a certain category of worker, a company must pay $1.80 for every $100 of payroll for workman's compensation insurance. The total gross pay for the year for those workers is $100,000 and the net pay is $70,000. What is the amount of insurance premium owed for workman's compensation insurance?

$1,800 $100,000 (gross pay)/100 = 1,000 x $1.80 = $1,800.

On May 15, K. Smith earned $3,000 and has the following deductions: FICA-OASDI 6.2%, FICA-Medicare 1.45%; federal income tax of $750; state income tax $90, and union dues of $50. What is her net pay?

$1,880.50

An employee has gross earnings of $3,200 with withholdings of 6.2% FICA-OASDI, 1.45% FICA-Medicare, $800 for federal income tax. State tax is 5% of the gross earnings. How much is the net pay?

$1,995.20

For a certain category of worker, a company must pay $1.90 for every $100 of payroll for workman's compensation insurance. The total gross pay for the year for those workers is $120,000 and the net pay is $78,000. What is the amount of insurance premium owed for workman's compensation insurance?

$2,280

An employee works 80 hours in a pay period and earns $30 per hour. With withholdings of 6.2% FICA-OASDI, 1.45 % FICA-Medicare, $500 for federal income tax and $70 for state income tax. How much is the gross pay

$2,400 The question is asking about gross pay which is gross earnings of $2,400 (80 hours x $30)

An employee has gross earnings of $3,000 with withholdings of 6.2% FICA-OASDI, 1.45 % FICA-Medicare, $600 for federal income tax and $50 for state income tax. How much is the gross pay?

$3,000 The question is asking about gross pay which is gross earnings of $3,000.

On May 15, M. Griffith earned $6,000 and has the following deductions: FICA-OASDI 6.2%, FICA-Medicare 1.45%; federal income tax of $1,200; state income tax $300, and health insurance premium of $100. What is his net pay?

$3,941 The net pay is $3,941 found as follows: Gross pay of $6,000 less FICA $459 ($6,000 x .062 + $6,000 x .0145) - federal income tax $1,200 - state income tax $300 - health insurance premium $100

Fred's cumulative earnings before this pay period were $6,700, 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?

$300 Gross pay for the week is $600 and his cumulative earnings are $6,700. This means that he has not met the limits yet for FUTA and SUTA, however only $300 of the $600 would be subject to tax..

The gross pay for a particular period is $23,000 however, the FUTA taxable earnings for that amount is $10,000. If the FUTA rate is 6% and the FUTA tax credit is 5.4%, what amount does the employer owe for FUTA?

$60 FUTA = FUTA earnings of $10,000 x (6% - 5.4%) = $10,0000 x .006 = $60.

Jared'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?

$600 Gross pay for the week is $600 and his cumulative earnings are $5,340. This means that he has not met the limits yet for FUTA and SUTA, so his entire gross pay is taxable.

If the employee has $600 withheld from their check for FICA-OASDI, what is the amount that the employer would need to pay?

$600 The employer must pay the same amount for FICA that the employee is paying. It is a 100% (dollar-for-dollar) match.

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

$700

The gross pay for a particular period is $27,000 however, the FUTA taxable earnings for that amount is $15,000. If the FUTA rate is 6% and the FUTA tax credit is 5.4%, what amount does the employer owe for FUTA?

$90 FUTA = FUTA earnings of $15,000 x (6% - 5.4%) = $15,0000 x .006 = $90

FICA includes:

A tax for Medicare insurance A tax for survivor and disability insurance A tax for old age benefits also known as Social Security

Which of the following does not fit the definition of a work week?

A time period that starts on a Monday and ends 40 hours later

What do Federal unemployment taxes, state unemployment taxes, and FICA-OASDI taxes all have in common?

All have an annual ceiling limit Many taxes have a ceiling limit that changes each year. The IRS Circular-E is updated annually as a reference for employers.

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

All of the listed answers are correct. FICA-OASDI Federal unemployment taxes State unemployment taxes

Which of the following records provides a summary of an employee's earnings, withholding taxes, net pay, cumulative earnings during the year?

Employee earnings record The employee earnings provides a summary of each employee's earnings, withholding taxes, net pay, and cumulative earnings during each calendar year.

S. Hughes is an employee of ABC Corp. At year end, the accountants for ABC prepare the W-2 for S. Hughes by referring to which of the following documents?

Employee earnings record The employee earnings record shows the year-to-date gross pay, deductions, and net pay for each employee and is the source document for the W-2.

Which of the following would not be part of an employer's payroll tax expense?

Employee income tax withholding

Both employees and employers pay which of the following taxes?

FICA taxes (OASDI and Medicare)

Which of the following must also be "matched" by the employer and paid from company funds?

FICA-OASDI taxes withheld from the employee's paycheck

What payroll related tax is based on wages paid to employees and based on employer's payment history?

Federal Unemployment taxes Unemployment taxes are paid by employers based on wages paid to employees and also their history.

Employers pay the following payroll taxes, except:

Federal and state income taxes Employers do not match the amount of federal and state income taxes paid by employees.

The amount of FICA-OASDI and FICA-Medicare withheld from the employee's check is determined by the employee's:

Gross Earnings for the period and cumulative gross earnings.

What is the worksheet used to record payroll data?

Payroll register

What would S-1 signify on a payroll register?

Single filing status with 1 allowance S-1 would be the employer's tax filing status (single) and the number of allowances specified by the employee for tax withholding purposes.

What record keeps track of an individual employee's payroll history for a calendar year?

The employee earnings record

Which of the following is not included in the FICA tax?

Unemployment tax FICA includes both Social Security tax (OASDI, or Old Age, Survivors and Disability Insurance) and Medicare tax. It does not include unemployment taxes.

Which of the following would not be on a payroll register?

Unemployment taxes A payroll register typically shows each employee's gross earnings, employee withholding taxes, net pay, taxable earnings, cumulative earnings, and the accounts to be charged for the salary and wage expense for that pay period. It does not show unemployment taxes as that is typically calculated and entered into the general journal.

Which of the following would not be part of an employer's payroll tax expense?

Union dues withheld from an employee's paycheck Union dues are the responsibility of the employee and are withheld as part of the gross pay of an employee and therefore are accounted for as compensation expense and as a payable at the time of the withholding.

Which form provides the number of allowances an employee has claimed to determine the amount of federal income tax to withhold?

W-4

Insurance purchased by most employers to protect their employees against losses due to injury or death while on the job is called:

Workman's Compensation Insurance

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

allowances

Federal Unemployment taxes are:

based on wages paid to employees and based on employer's payment history.

Which of the following is NOT true about the amount of FICA-OASDI and FICA-Medicare withheld from the employee's check?

false) It is determined by the amount of net pay earned by the employee up to a maximum annual amount. true)It is determined by the employee' gross Earnings for the period and cumulative gross earnings. true)OASDI puts a limit on the amount of tax that an employee must pay by setting a maximum annual dollar amount of earnings that can be taxed. true)Medicare withholding is calculated on all earnings of the employee without an annual maximum The amount of FICA-OASDI and FICA-Medicare withheld from the employee's check is determined by the employee's Gross Earnings for the period and cumulative gross earnings. OASDI puts a limit on the amount of tax that an employee must pay by setting a maximum annual dollar amount of earnings that can be taxed.

A W-4 form:

provides the number of allowances an employee has claimed. A W-4 form provides the number of allowances an employee has claimed. The W-4 form is used for payroll purposes to determine federal income tax withholding from an employee's paycheck.

J. Ryan CPA is looking at the company report showing the year-to-date gross pay, deductions, and net pay for a specific employee. Ryan is reviewing:

the employee earnings record