Accounting General Journal, 9E: Chapter 12
Preparing Payroll Records
Terms in this set (23)
employee earnings record
a business form used to record details affecting payments made to an employee
a federal tax paid for hospital insurance
the total earnings paid to an employee after payroll taxes and other deductions
the period covered by a salary payment
the total amount earned by all employees for a pay period
a business form used to record payroll information
taxes based on the payroll of a business
the money paid for employee services
social security tax
a federal tax paid for old-age, survivors, and disability insurance
the maximum amount of earnings on which a tax is calculated
the total pay due for a pay period before deductions
a deduction from total earnings for each person legally supported by a taxpayer, including the employee
What is payroll?
The total amount earned by all employees for a pay period.
How does Hobby Shack calculate overtime earnings?
Overtime hours X the overtime rate
Where does an employer get the information used to determine the amount of federal income tax to withhold from employee's earnings?
Employee's Withholding Allowance Certificate
Employee federal income tax withholding are based on what two factors?
Employee marital status and number of withholding allowances
Does the employer or employee pay social security tax and Medicare tax?
Both the employee and the employer
What does the payroll register summarize?
The payroll register summarizes the payroll for one pay period and shows total earnings, payroll withholding's and net pay of all employees.
How is net pay calculated?
By subtracting total deductions from total earnings.
Why do companies complete employee earnings records?
Because a business must send a quarterly report to federal and state governments showing employee taxable earnings and taxes withheld from employee earnings.
Why does Hobby Shack have a separate checking account for payroll checks?
To help protect and control payroll payments.
What is the source of the information that is recorded on each employee's payroll check stub?
The payroll register.
How do payroll procedures differ from employees who request that their pay be deposited through electronic funds transfer (EFT)?
Individual checks are not written and do not have to be distributed.