Question 1

Obligations to be paid within one year or the company's operating cycle,whichever is longer,are:

Accepted Answer

A) Current assets. 
B) Current liabilities. 
C) Earned revenues. 
D) Operating cycle liabilities. 
E) Bills. 
A) Current assets. 
B) Current liabilities. 
C) Earned revenues. 
D) Operating cycle liabilities. 
E) Bills.

Question 2

The payroll records of a company provided the following data for the current weekly pay period ended March 12.   Assume that the Social Security portion of the FICA taxes is 6.2% on the first $117,000 and the Medicare portion is 1.45% of all wages paid to each employee for this pay period.The federal and state unemployment tax rates are 0.8% and 5.4%,respectively,on the first $7,000 paid to each employee.Calculate the net pay for each employee.

Accepted Answer

The answer of The payroll records of a company provided...

Question 3

The difference between the amount borrowed and the amount repaid is referred to as _______________.

Accepted Answer

The answer of The difference between the amount borrowed and...

Question 4

The deferred income tax liability:

Accepted Answer

A) Results from the income tax expense reported on the income statement differing from the amount of income taxes payable to the government. 
B) Is a contingent liability. 
C) Can result in a deferred income tax asset. 
D) Is never recorded. 
E) Is recorded whether or not the difference between taxable income and financial accounting income is permanent or temporary. 
A) Results from the income tax expense reported on the income statement differing from the amount of income taxes payable to the government. 
B) Is a contingent liability. 
C) Can result in a deferred income tax asset. 
D) Is never recorded. 
E) Is recorded whether or not the difference between taxable income and financial accounting income is permanent or temporary.

Question 5

The amount of federal income taxes withheld from an employee's paycheck is determined by:

Accepted Answer

A) Current earnings for the pay period and number of withholding allowances the employee claims. 
B) The employer's merit rating. 
C) The amount of social security taxes withheld. 
D) Multiplying the gross pay by 6.2%. 
E) Tax tables provided by the state in which the employee works. 
A) Current earnings for the pay period and number of withholding allowances the employee claims. 
B) The employer's merit rating. 
C) The amount of social security taxes withheld. 
D) Multiplying the gross pay by 6.2%. 
E) Tax tables provided by the state in which the employee works.

Question 6

The total compensation an employee earns including wages,salaries,commissions,bonuses,and any compensation earned before deductions such as taxes is called ___________________.

Accepted Answer

The answer of The total compensation an employee earns including...

Question 7

A company has three employees.Total salaries for the month of January were $8,000.The federal income tax rate for all employees is 15%.The FICA-social security tax rate is 6.2% and the FICA-Medicare tax rate is 1.45%.Calculate the amount of employee taxes withheld and prepare the company's journal entry to record the January payroll assuming these were the only deductions.

Accepted Answer

The answer of A company has three employees.Total salaries for...

Question 8

The annual Federal Unemployment Tax Return is:

Accepted Answer

A) Form 940. 
B) Form 1099. 
C) Form 104. 
D) Form W-2. 
E) Form W-4. 
A) Form 940. 
B) Form 1099. 
C) Form 104. 
D) Form W-2. 
E) Form W-4.

Question 9

All of the following are true of known liabilities except:

Accepted Answer

A) Include accounts payable,notes payable,and payroll. 
B) Are obligations set by agreements,contracts,or laws. 
C) Are measurable. 
D) Are definitely determinable. 
E) May depend on some future event occurring. 
A) Include accounts payable,notes payable,and payroll. 
B) Are obligations set by agreements,contracts,or laws. 
C) Are measurable. 
D) Are definitely determinable. 
E) May depend on some future event occurring.

Question 10

Employer payroll taxes:

Accepted Answer

A) Are added expenses beyond that for the wages and salaries earned by employees. 
B) Represent the federal taxes withheld from employees. 
C) Represent the social security taxes withheld from employees. 
D) Are paid by the employee. 
E) Are payable for up to a maximum $117,000 of employee earnings. 
A) Are added expenses beyond that for the wages and salaries earned by employees. 
B) Represent the federal taxes withheld from employees. 
C) Represent the social security taxes withheld from employees. 
D) Are paid by the employee. 
E) Are payable for up to a maximum $117,000 of employee earnings.

Question 11

Times interest earned is calculated by:

Accepted Answer

A) Multiplying interest expense by income. 
B) Dividing interest expense by income before interest expense. 
C) Dividing income before interest expense and income taxes by interest expense. 
D) Multiplying interest expense by income before interest expense. 
E) Dividing income before interest expense by interest expense and income taxes. 
A) Multiplying interest expense by income. 
B) Dividing interest expense by income before interest expense. 
C) Dividing income before interest expense and income taxes by interest expense. 
D) Multiplying interest expense by income before interest expense. 
E) Dividing income before interest expense by interest expense and income taxes.

Question 12

Trey Morgan is an employee who is paid monthly.For the month of January of the current year,he earned a total of $4,538.The FICA tax for social security is 6.2% and the FICA tax rate for Medicare is 1.45% for both the employee and the employer.The amount of federal income tax withheld from his earnings was $680.70.His net pay for the month is:

Accepted Answer

A) $3,510.14 
B) $3,857.30 
C) $4,190.84 
D) $4,538.00 
E) $3,162.98 
A) $3,510.14 
B) $3,857.30 
C) $4,190.84 
D) $4,538.00 
E) $3,162.98

Question 13

A _____________________ shows the pay period dates,hours worked,gross pay,deductions,and net pay of each employee for every pay period.

Accepted Answer

The answer of A _____________________ shows the pay period dates,hours...

Question 14

Gross pay less all deductions is called ____________________.

Accepted Answer

The answer of Gross pay less all deductions is called...

Question 15

Deacon Company provides you with following information related to payroll transactions for the month of May.Prepare journal entries to record the transactions for May.   a.Recorded the May payroll using the payroll register information given above.
b.Recorded the employer's payroll taxes resulting from the May payroll.The company had a merit rating that reduces its state unemployment tax rate to 3.5% of the first $7,000 paid each employee.Only $42,000 of the current months salaries are subject to unemployment taxes.The federal rate is 0.6%.
c.Issued a check to Reliant Bank in payment of the May FICA and employee taxes.
d.Issued a check to the state for the payment of the SUTA taxes for the month of May.
e.Issued a check to Reliant Bank in payment of the employer's quarterly FUTA taxes for the first quarter in the amount of $1,020.

Accepted Answer

The answer of Deacon Company provides you with following information...

Question 16

Accounts payable are:

Accepted Answer

A) Amounts owed to suppliers for products and/or services purchased on credit. 
B) Long-term liabilities. 
C) Estimated liabilities. 
D) Not usually due on specific dates. 
E) Always payable within 30 days. 
A) Amounts owed to suppliers for products and/or services purchased on credit. 
B) Long-term liabilities. 
C) Estimated liabilities. 
D) Not usually due on specific dates. 
E) Always payable within 30 days.

Question 17

Which of the following is not true regarding the unemployment insurance program?

Accepted Answer

A) It requires withholding from the employee wages. 
B) It is administered by each state. 
C) It provides unemployment benefits to qualified workers. 
D) It adjusts rates paid by employers based on their merit rating. 
E) It is a joint federal and state program. 
A) It requires withholding from the employee wages. 
B) It is administered by each state. 
C) It provides unemployment benefits to qualified workers. 
D) It adjusts rates paid by employers based on their merit rating. 
E) It is a joint federal and state program.

Question 18

When a company is obligated for sales taxes payable,it is reported as a(n):

Accepted Answer

A) Estimated liability. 
B) Contingent liability. 
C) Current liability. 
D) Business expense. 
E) Long-term liability. 
A) Estimated liability. 
B) Contingent liability. 
C) Current liability. 
D) Business expense. 
E) Long-term liability.

Question 19

An employee earned $62,500 during the year working for an employer.The FICA tax rate for Social Security is 6.2% and the FICA tax rate for Medicare is 1.45%.The current FUTA tax rate is 0.6%,and the SUTA tax rate is 5.4%.Both unemployment taxes are applied to the first $7,000 of an employee's pay.What is the amount of total unemployment taxes the employee must pay?

Accepted Answer

A) $101.50 
B) $56.00 
C) $378.00 
D) $434.00 
E) $0.00 
A) $101.50 
B) $56.00 
C) $378.00 
D) $434.00 
E) $0.00

Question 20

_________________ are probable future payments of assets or services that a company is presently obligated to make as a result of past transactions or events.

Accepted Answer

The answer of _________________ are probable future payments of assets...

Exam 11: Current Liabilities and Payroll Accounting

Obligations to be paid within one year or the company's operating cycle,whichever is longer,are:

The difference between the amount borrowed and the amount repaid is referred to as _______________.

The deferred income tax liability:

The amount of federal income taxes withheld from an employee's paycheck is determined by:

The total compensation an employee earns including wages,salaries,commissions,bonuses,and any compensation earned before deductions such as taxes is called ___________________.

The annual Federal Unemployment Tax Return is:

All of the following are true of known liabilities except:

Employer payroll taxes:

Times interest earned is calculated by:

A _____________________ shows the pay period dates,hours worked,gross pay,deductions,and net pay of each employee for every pay period.

Gross pay less all deductions is called ____________________.

Accounts payable are:

Which of the following is not true regarding the unemployment insurance program?

When a company is obligated for sales taxes payable,it is reported as a(n):

_________________ are probable future payments of assets or services that a company is presently obligated to make as a result of past transactions or events.

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets, Natural Resources, and Intangibles

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Appendix B: Time Value of Money

Appendix C: Activity-Based Costing

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