Accounting Chapter 12 True and False
Social security tax is paid by the employer only
False
The first task in preparing a payroll is to determine the number of days worked by each employee.
False
Total earnings are sometimes referred to as net pay or net earnings.
False
Employers in many states are required to withhold state, city, or county income tax from employee earnings
True
Payroll taxes withheld represent a liability for an employer until payment is made to the government.
True
Payroll time cards can be used as the basic source of information to prepare a payroll.
True
The amount of income tax withheld from each employee's total earnings is determined from the number of withholding allowances and by the employee's marital status
True
The columns of the employee earnings record consist of the amount columns in a payroll register and an accumulated earnings column
True
The larger the number of withholding allowances claimed, the larger the amount of income tax withheld
True
When an employee's earnings exceed the tax base, no more social security tax is deducted
True
A new earnings record is prepared for each employee each year
False
A single person will have less income tax withheld than a married employee
False
Employers are required to have a current Form W-4, Employee's withholding allowance Certificate, for all employees
True
A business is required by law to withhold federal income taxes from employee total earnings.
True
A business may decide to pay employee salaries every week, every two weeks, twice a month, or once a month.
True
All deductions from employee wages are recorded in a payroll register
True
An act of congress can change the social security tax base and tax rate at any time
True
An employee can be exempt from having federal income tax withheld under certain conditions
True
Businesses use payroll records to inform employees of their annual earnings and to prepare payroll reports for the government.
True
Employee earnings are calculated as regular hours X regular rate, plus overtime hours X overtime rate.
True