Question 1

Junkman Autos uses a separate checking account to pay their employees. The gross pay for the period was $1,000. However, after deductions were taken out, the net pay for the period was $820. The journal entry to record the issuance of payroll checks to their employees is:

Accepted Answer

A) 
 
B) 
 
C) 
 
D)

Question 2

Lisa Ramos has a regular hourly rate of $12.75. In a week when she worked 40 hours and had deductions of $67.00 for federal income tax, $31.62 for social security tax, and $7.40 for Medicare tax, her net pay was

Accepted Answer

A) $616.02 
B) $403.98 
C) $510.00 
D) $106.02

Question 3

The total amount earned by the employee is called the

Accepted Answer

A) payroll. 
B) gross pay. 
C) take home pay. 
D) net pay.

Question 4

The Social Security Tax Payable account will normally have a(n)

Accepted Answer

A) debit or credit balance depending on the timing of payments. 
B) credit balance. 
C) debit balance. 
D) zero balance.

Question 5

Identify the list of accounts below that would normally all have a credit balance.

Accepted Answer

A) Employee Income Tax Payable, Social Security Tax Payable, Salaries Expense. 
B) Salaries Payable, Prepaid Insurance, Medicare Tax Payable. 
C) Wages Expense, Salaries Payable, Equipment. 
D) Salaries Payable, Employee Income Tax Payable, Owner's Capital.

Question 6

During one week, three employees of the Tea Leaf Cafe worked the number of hours shown below. All these employees receive overtime pay at one and a half times their regular hourly rate for any hours worked beyond 40 in a week. Compute the regular earnings, overtime earnings, and gross pay for each employee.

Accepted Answer

The answer of During one week, three employees of the...

Question 7

The monthly salaries for December and the year-to-date earnings as of November 30 for the three employees of the Lakeview Medical Center are listed below. Compute the amount of social security tax and Medicare tax to be withheld from each of the employee's gross pay for December. Assume a 6.2 percent social security tax rate on a maximum of $122,700 for the calendar year. Assume a 1.45 percent Medicare tax rate.

Accepted Answer

The answer of The monthly salaries for December and the...

Question 8

The column totals in a payroll register

Accepted Answer

A) are used in the journal entry to record the payroll. 
B) are posted directly to the general ledger accounts. 
C) are used at the end of the year to record payroll taxes owed to the IRS. 
D) are unnecessary.

Question 9

Employers are required to pay for ________ insurance that will reimburse employees for losses suffered from job-related injuries.

Accepted Answer

The answer of Employers are required to pay for ________...

Question 10

During the week ended May 15, 2019, Scott Fairchild worked 40 hours. His regular hourly rate is $14 .Assume that all of his earnings are subject to social security tax at a rate of 6.2 percent and Medicare tax at a rate of 1.45 percent. He also has deductions of $31 for federal income tax and $21 for health insurance.
A)What is his gross pay for the week?
B)What is the total of his deductions for the week?
C)What is his net pay for the week?

Accepted Answer

The answer of During the week ended May 15, 2019,...

Question 11

Identify the list of accounts below that would normally all have a debit balance.

Accepted Answer

A) Salaries Payable, Medicare Tax Payable, Office Salaries Expense. 
B) Salaries Expense, Salaries Payable, Cash. 
C) Cash, Salaries Expense, Insurance Expense. 
D) Employee Income Tax Payable, Social Security Tax Payable, Wages Expense.

Question 12

During the week ended February 8, 2019, Stuart Wayne worked 40 hours. His regular hourly rate is
$12) Assume that all of his earnings are subject to social security tax at a rate of 6.2 percent and Medicare tax at a rate of 1.45 percent. He also has deductions of $31 for federal income tax and $21 for health insurance.
A)What is his gross pay for the week?
B)What is the total of his deductions for the week?
C)What is his net pay for the week?

Accepted Answer

The answer of During the week ended February 8, 2019,...

Question 13

Lacy Crawford has a regular hourly rate of $21.50. In a week when she worked 40 hours and had deductions of $110 for federal income tax, $53.32 for social security tax, and $12.47 for Medicare tax, her net pay was

Accepted Answer

A) $684.21 
B) $860.00 
C) $794.21 
D) $750.00

Question 14

An employee whose regular hourly rate is $20 and whose overtime rate is 1.5 times the regular rate worked 45 hours one week. The employee's gross pay was

Accepted Answer

A) $950. 
B) $900. 
C) $800. 
D) $1,350.

Question 15

The maximum base for the social security tax is the same as that for the Medicare tax.

Accepted Answer

A) True 
 B)False

Question 16

The net amount due employees for their wages is recorded as a debit to Salaries and Wages Payable.

Accepted Answer

A) True 
 B)False

Question 17

When checks are issued to employees after the entry to record the payroll has been made, the accountant would

Accepted Answer

A) debit Salaries and Wages Payable and credit Cash. 
B) debit Salaries Expense, debit Wages Expense, and credit Cash. 
C) debit Salaries and Wages Payable, debit Social Security Tax Payable, debit Medicare Tax Payable, debit Employee Income Tax Payable, and credit Cash. 
D) debit Salaries and Wages Payable and credit Salaries Expense and Wages Expense.

Question 18

Federal law requires employers to withhold which of the following taxes from the employee's pay?

Accepted Answer

A) Federal and state income tax, social security tax, Medicare tax, and FUTA. 
B) federal income tax, social security tax, Medicare tax, and state and local taxes. 
C) federal income tax, social security tax, and Medicare tax. 
D) federal income tax, social security tax, Medicare tax, and FUTA.

Question 19

The employer records the amount of federal income tax withheld as:

Accepted Answer

A) a liability. 
B) an expense. 
C) an asset. 
D) a payroll tax expense.

Question 20

Federal law requires employers to pay which of the following employment related taxes?

Accepted Answer

A) Federal and state income tax, social security tax, Medicare tax, and FUTA. 
B) FICA tax, federal and state income tax and federal unemployment compensation tax 
C) only federal and state unemployment compensation tax 
D) FICA tax and federal unemployment compensation tax

Exam 10: Payroll Computations, Records, and Payment