Accounting Study Guide
Terms in this set (60)
Each pay period the payroll information for each employee is recorded on each employee earnings record.
Separate payroll accounts for each employee are kept in the general ledger.
The payroll register and employee earnings records provide all the payroll information needed to prepare a payroll.
The column totals of an employee earnings record provide the debit and credit amounts needed to journalize a payroll.
The source document for payment of a payroll is the time card.
Amounts recorded in the General columns of a journal are posted individually to general ledger accounts.
Employers must pay to the government the taxes withheld from employee earnings.
Employer payroll taxes are business expenses.
Employer payroll taxes expense is based on a percentage of employee earnings.
The employer social security tax rate is not the same as the employee social security tax rate.
Federal unemployment insurance laws require that employers and employees pay taxes for unemployment compensation.
An employer is not required to pay federal unemployment taxes on an employee who has already earned $7,000.00 during the calendar year.
The transaction to record employer payroll taxes expense is journalized at the end of the quarter.
The source document for journalizing employer payroll taxes is a check.
Each employer is required by law to periodically report the payroll taxes withheld from employee salaries.
Each employer who withholds income tax and social security and Medicare tax from employee salaries must furnish each employee with a quarterly statement.
Form W-3, Transmittal of Income and Tax Statements, is sent to the Social Security Administration by February 28 each year.
Employee withheld income tax, employee social security and Medicare tax, and employer social security and Medicare tax are paid periodically to the federal government in a combined payment.
The 12-month period that ends on June 30th of the prior year is called the lookback period.
The Internal Revenue Service provides businesses with a flowchart to assist them in determining when to make tax deposits.
In the journal entry for a payroll, the amount debited to Salary Expense is the total of the Net Pay column of the payroll register.
In the journal entry for a payroll, the amount credited to Cash is the total of the Total Earnings column of the payroll register.
The tax base for Medicare tax is usually the same as the tax base for social security tax.
If an employee's accumulated earnings are $6,500.00, and the employee earns another $1,500.00, the amount of new earnings subject to unemployment tax is $1,500.00.
An employee who earns $1,000.00 semimonthly will have unemployment taxable earnings until the middle of May.
Calculating federal and state unemployment tax is complicated because the state and federal unemployment tax regulations use different tax bases.
The only reason an employee receives a Form W-2 Wage and Tax Statement from an employer is to check it for accuracy.
The payment of payroll taxes with the government is referred to as a deposit.
All businesses must use the Electronic Federal Tax Payment System to deposit payroll taxes.
Some employers must deposit payments for withheld employees' federal income tax and social security and Medicare taxes on the next banking day.
D. the payroll register and the employee earnings record
All the payroll information needed to prepare a payroll and tax reports is found on ____.
Until the amounts withheld from employee salaries are paid by the employer, they are recorded as ____.
B. a check
The source document for payment of a payroll is ____.
A. Salary Expense
The entry to journalize paying a semimonthly payroll less deductions for employee income tax, social security and Medicare tax, and U.S.
B. social security and Medicare, federal unemployment, and state unemployment taxes
Employers must pay payroll taxes for ____.
B. the same rate and earnings as employee social security tax
The employer social security tax rate is based on ____.
C. employers and employees
Social security and Medicare taxes are paid by ____.
A. unemployment taxable earnings
The total earnings subject to federal unemployment tax is referred to as ____.
C. Payroll Taxes Expense
In the entry to journalize employer payroll taxes expense for a semimonthly period, the account debited would be ____.
B. Unemployment Tax Payable-Federal
In the entry to journalize employer payroll taxes expense for a semimonthly period, an account credited would be ____.
Each employer must file a federal tax return showing the federal income tax and social security and Medicare taxes due the government ____.
Each employer must file a federal tax return showing the federal income tax and social security and Medicare taxes due the government on a Form ____.
The report that shows total year's earnings and amounts withheld for taxes for an employee is prepared on Form ____.
D. January 31 of the following year
Employers are required to furnish each employee an annual statement of earnings and withholdings before ____.
The form used for the transmittal of the previous year's earnings and payroll taxes withheld for all employees is Form ____.
A. a check
The source document for paying employee income tax and social security and Medicare tax is ____.
B. Unemployment Tax Payable-Federal
In the entry to journalize paying the liability for the first quarter federal unemployment tax, an account debited would be ____.
In the entry to journalize paying the liability for the first quarter federal unemployment tax, the account credited would be ____.
B. during the month following each calendar quarter
In general, employers are required to pay state unemployment taxes ____.
A. a check
The source document for paying state unemployment tax is ____.
A. Earnings Total column, each deduction column, and Net Pay column
The payroll journal entry is based on the totals of ____.
C. an asset account
The total of the Net Pay column of the payroll register is credited to ____.
D. net pay of all employees
When a semimonthly payroll is paid, the credit to Cash is equal to the ____.
B. Salary Expense
The Total Earnings column total is journalized as a debit to ____.
C. a liability account
The total of the Federal Income Tax column of a payroll register is credited to
C. federal unemployment tax
A federal tax used for state and federal administrative expenses of the unemployment program is ____.
D. state unemployment tax
A state tax used to pay benefits to unemployed workers is ____.
C. Social Security Tax Payable, Medicare Tax Payable, Unemployment Tax Payable-Federal, and Unemployment Tax Payable-State
To record the employer payroll taxes expense, the following accounts are credited:
To record the total federal tax payment for employee income tax, social security tax and Medicare tax, the account credited is ____.
C. a liability account
To record the payment of federal unemployment tax, the account debited is ____.
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