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Accounting Chapter 12

Terms in this set (24)

Wage
The amount paid to an employee for every hour worked
Salary
A fixed annual sum of money divided among equal pay periods
Commission
Method of paying an employee based on the amount of sales that the employee generates
Total Earnings
The total amount paid by a business for an employee's work, earned by a wage, salary, or commission
Pay Period
Number of days or weeks or work covered by an employee's paycheck
Payroll
The total amount earned by all the employees for a pay period
Payroll Clerk
The accounting staff position that compiles and computes payroll data and then prepares, journalizes, and posts payroll transactions
Time Clock
Devise used to record the dates and times of every employee's arrivals and departures
Payroll Taxes
Taxes based on the payroll of a business
Withholding Allowance
A deduction from total earnings for each person legally supported by a taxpayer, including the employee
Payroll Deduction
Any amount withheld from an employee's gross earnings
Social Security Tax
A federal tax paid for old-age, survivors, and disability insurance
Medicare Tax
A federal tax paid for hospital insurance
Accumulated Earnings
The total gross earnings year to date for an employee
Tax Base
The maximum amount of earnings on which a tax is calculated
Qualified Retirement Plan
A retirement savings plan approved by the Internal Revenue Service that provides individuals with a tax benefit
401k
A qualified retirement plan sponsored by an employer
Individual Retirement Account (IRA)
A qualified retirement plan that provides most individuals with a deferred federal income tax benefit
Roth Individual Retirement Account (Roth IRA)
A qualified retirement plan that allows tax-free withdrawals from the account
Payroll Register
Summarizes the earnings, deductions, and net pay of all employees for one pay period
Employee Earnings Record
A business form used to record details of an employee's earnings and deductions
Voucher Check
Has a detachable check stub, or voucher, that contains detailed information about the cash payment
Direct Deposit
A payment of the employee's net pay using electronic funds transaction
Net Pay
The total earnings paid to an employee after payroll taxes and other deductions
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