Accounting Chapter 3
True
Commissions, cost of living adjustments, or share of profits, and a bonus are included in an employees earnings
Payroll taxes
Taxes based on the payroll of a business
False
The Internal Revenue Service sets the tax base and the tax rates for the Social Security tax
False
The amount of federal income tax to be withheld is determined solely by the number of withholding allowances
Wage
The amount paid to an employee every hour worked
True
Unemployment taxes are used to pay qualified workers for cash benefits for limited periods of unemployment
Employee earnings record
a business form used to record details of an employee's earnings and deductions
Electronic funds transfer
a computerized cash payments system that uses transfers funds without the use of checks, currency, or other paper documents
Withholding Allowance
a deduction from total earnings for each person legally supported by a taxpayer including the employee
Salary
A fixed annual amount of money divided among equal pay periods
True
A memorandum with an attached receipt is the source document for a payment made using the Electric Federal Tax Payment System
Pay period
A number of days or week of work covered by employees paycheck
False
After a biweekly payroll register has been completed, a check for the total earnings indicated on the payroll register is written for each employee
True
All time worked in excess of 40 hours in any one week is considered overtime
Payroll register
An accounting form that summarizes the earnings, deductions, and net pay of all employees for one pay period
True
An employees total earnings and deductions for the quarter are summarized on one line of the employee earnings record
False
Both employers and employees are required to pay federal unemployment tax
True
By January 31st, businesses must report to employees the earnings and amounts withheld for the previous calendar year
Automatic check deposit
Depositing payroll checks directly to an employee's checking or savings account
False
Employees are payed two times the regular rate for overtime hours
True
Employers are required by law to withhold certain payroll taxes from employee salaries each pay period
False
Employers pay government agencies all payroll taxes withheld from employee salaries on an annual basis
True
If a business is classified as a monthly scheduled depositor the business must pay the total amount due by the fifteenth day of the following months
False
In proving a payroll registers accuracy, the totally of the net pay column is subtracted from the total deductions column
False
Income and Medicare taxes are the only two federal taxes deducted from the earnings of each employee
True
Laws for handling state, city, and country taxes vary
True
Laws require employers to keep records of the payroll information and other payments related to employee services
False
Like Social Security, Medicare has a tax base
False
Only employers having total payroll taxes due greater than $1,000,000 are required to use the Electronic Federal Tax Payment System
True
Other deductions from employee earnings include health insurance, life insurance, retirement plan contributions, and charitable contributions
True
Payroll records must show the employees earnings, amounts withheld, net amount payed, and the total amount of payroll taxes that a business must pay
True
The frequency of payments for federal, state, and local government taxes is determined by the amount of tax payed each year
tax base
The maximum amount of earnings on which a tax is calculated
Payroll
The total amount earned by all employees for a pay period
True
The yearly report or an employees earnings and deductions that is provided to the employee is form W-2
True
Transferring payroll amount electronically from the employers account to the employees bank account is known as electronic funds transfer (EFT)