Chapter 13 Accounting

___ is the tax return that includes both federal and state unemployment taxes paid by the employer during the year.

Form 940

The document that reports the accumulated amounts of federal income taxes and FICA taxes withheld from employees' earnings for the quarter is __

Form 941

The wage and tax statement that summarizes an employee's earnings and tax decutions for the previous calendar year is called__.

Form W-2

The transmittal of income and tax statements that is filed by the employer with the Internal Revenue Service is called__.

Form W-3

An increase in State Unemployment Tax Payable would be a ___.

credit

The Medicare Tax Payable account would normally have a __ balance.

credit

The account Employees' Federal Income Tax Payable would normally have a __ balance

credit

The account Insurance Premiums Payable would normally have a ___ balance.

credit

The total net pay for the period is entered on the __ side of the Cash in Bank account.

credit

A decrease in U.S. Savings Bonds Payable would be a __

debit

Salaries Expense would normally have a __ balance

debit

The Payroll Tax Expense account normally has a __ balance.

debit

The amount of gross earnings is entered on the ___ side of the Salaries Expense account.

debit

When a payment is made to the state government for the employees' state income tax, an entry is made on the __ side of the Employees' State Income Tax Payable account.

debit

Amounts withheld from gross earnings and held by the employer until the time of payment are assets of the business.

false

An employer is required to file only an annual tax report on employee earnings and on taxes paid by the employee and the employer.

false

Employees' wages are a liability of the business.

false

Federal withholding taxes and social security taxes are normally paid once a year by the employer.

false

The Cash in Bank account is debited for the amount fo the employees actually earn in the pay period.

false

The Unemployment Tax Payable account is used to record both federal and state unemployment taxes.

false

The amount entered for Payroll Tax Expense is the total gross earnings of the pay period.

false

The entry for Salaries Expense is recorded each pay period but the entry for Payroll Tax Expense is recorded only at the end of the year.

false

The only taxes that the employer must pay are unemployment taxes.

false

When a business transfers money from its regular checking account to the payroll checking account the check is written for the amount of gross earnings.

false

The form that is prepared and sent wuth the employer's check to show the amount of taxes being sent to the federal government is a ___

federa tax deposit coupon

Amounts deducted from the employees' earnings and held for payment by the employer become liabilities to the business.

true

Both the employee and the employer pay the same rate for social security and Medicare taxes.

true

Form W-2 must be prepared and given to each employee by January 31 of the year following that in which the taxes were deducted.

true

Social security tax is paid by the employer and the employees.

true

The Cash in Bank account is credited for the total amount that is paid by the employer to the employees.

true

The payroll register is the source of information for preparing the journal entry for payroll.

true

The salary expense of a business is equal to the total gross earnings.

true

The taxes that an employer must pay are FICA taxes and unemployment taxes.

true

___ are usually paid only by the employer and collected to provide funds for workers who are temporarily out of work

unemployment taxes