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Exam 11: Payroll Taxes, Deposits, and Reports

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Question 31

True/False

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To achieve internal control over payroll operations, no changes in employee pay rates should be made without written authorization from management.

A) True
B) False

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Question 32

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The payments of employees' federal income taxes withheld and social security and Medicare taxes are periodically

A) deposited in a special-purpose bank account, controlled by the company, until year-end when the funds are sent to the U.S. Treasury Department.
B) deposited in a government-authorized financial institution.
C) sent directly to the Internal Revenue Service.
D) sent to the local office of the Internal Revenue Service.

E) B) and D)
F) A) and B)

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Question 33

Multiple Choice

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All of the following are internal control procedures that are recommended to protect payroll operations except

Which of the following taxes is not withheld from an employee's pay?

ABC Consulting had two employees with the following earnings information: - Use the table above to calculate the employer payroll income taxes associated with Poppy's December 15 paycheck given the following tax rates: Social Security tax of 6.2% is levied on the first $122,700 of annual wages and the Medicare tax rate is 1.45% on all earnings. State unemployment tax of 5.4% and federal unemployment tax of 0.6% are both levied on only the first $7,000 of each employee's annual earnings.

A business pays ________ and Medicare taxes at the same rate and on the same taxable wages as its employees.

Form 941 is filed

The payroll register of the Retro Manufacturing Company showed total employee earnings of $37,000 for the week ended January 18, 2019. Compute the employer's payroll taxes for the period. Use a rate of 6.2 percent for the employer's share of the social security tax, 1.45 percent for Medicare tax, 0.6 percent for FUTA tax, and 5.4 percent for SUTA tax. Assume all earnings are taxable.

A business pays the social security tax at the same rate and on the same taxable wages as its employees.

Which of the following payroll taxes is not paid by the employee?

A firm must issue a Form ________ to each employee by January 31 of the year following the year during which the wages were earned.

Alfred Spindle earned gross wages of $1,850 for the week ended January 18, 2019. His gross wages year to date, prior to his January 18 paycheck, were $3,700. He had $96 withheld from his pay for federal income taxes, and $56 for health insurance. Social Security tax is 6.2% and Medicare tax is 1.45%; the federal unemployment tax rate is 0.6% and the state unemployment tax rate is 4.2%, both on a maximum of $7,000 per each employee's annual earnings. What is the total employer payroll tax expense associated with Alfred's January 18, 2019, paycheck?

Jackson Autos has one employee. As of March 30, their employee had already earned $6,300. For the pay period ending April 15, their employee earned an additional $2,000 of gross wages. Only the first $7,000 of annual earnings are subject to FUTA of 0.6% and SUTA of 5.4%. The journal entry to record the employer's unemployment payroll taxes for the period ending April 15, would be:

Which of the following payroll taxes is not paid by the employee?

After the Marion Corporation paid its employees on November 15, 2019, and recorded the corporation's share of payroll taxes for the payroll paid that date, the firm's general ledger showed a balance of $1,925 in the Social Security Tax Payable account, a balance of $519 in the Medicare Tax Payable account, and a balance of $2,105 in the Employee Income Tax Payable account. On November 16, 2016, the business issued a check to deposit the taxes owed in the local bank. Record this transaction on page 5 of a general journal.

After the Mansley Company paid its employees on July 15, 2019, and recorded the corporation's share of payroll taxes for the payroll paid that date, the firm's general ledger showed a balance of $1,365 in the Social Security Tax Payable account, a balance of $321 in the Medicare Tax Payable account, and a balance of $1,962 in the Employee Income Tax Payable account. On July 16, 2019, the business issued a check to deposit the taxes owed in the local bank. Record this transaction on page 23 of a general journal.

The frequency of deposits of federal income taxes withheld and social security and Medicare taxes is determined by the amount owed.

Mr. Zee worked 48 hours during the week ended January 18, 2019. He is paid $12 per hour, and is paid time and a half for all hours over 40 in a week. He had $100 withheld from his pay for federal income taxes, and $20 withheld for health insurance. The combined social security and Medicare tax rate is 7.65%, and the federal and state unemployment tax rates are 0.6% and 3.8%, respectively. All earnings are taxable. What is the net pay for Mr. Zee's current pay check?

The payroll register of Vtech Enterprises showed total employee earnings of $2,100 for the week ended August 2, 2019. Compute the employer's payroll taxes for the period. The tax rates are: Social security tax, 6.2 percent; Medicare tax, 1.45 percent; FUTA tax, 0.6 percent; SUTA tax, 2.2 percent. All earnings are taxable. Record the employer's payroll taxes for the period on page 4 of a general journal.

Mr. Zee worked 48 hours during the week ended January 18, 2019. He is paid $12 per hour, and is paid time-and-a-half for all hours over 40 in a week. He had $100 withheld from his pay for federal income taxes, and $20 withheld for health insurance. The combined social security and Medicare tax rate is 7.65%, and the federal and state unemployment tax rates are 0.6% and 3.8%, respectively. All earnings are taxable. What is the total employer payroll tax expense for Mr. Zee's current paycheck?