True/False
Indicate whether the sentence or statement is true
or false.
|
|
|
1.
|
The
money paid for employee services is a salary.
|
|
|
2.
|
The
period covered by a salary payment is a pay period.
|
|
|
3.
|
All
businesses base their salary payments on the same length of time.
|
|
|
4.
|
A pay
period may be weekly.
|
|
|
5.
|
The
total amount earned by all employees for a pay period is a payroll.
|
|
|
6.
|
A
payroll system must include an accurate record of the time each employee has worked.
|
|
|
7.
|
Total
earnings are sometimes referred to as gross pay.
|
|
|
8.
|
Businesses must withhold federal income tax from employee total
earnings.
|
|
|
9.
|
Payroll taxes withheld represent a liability for an employer until payment is
made.
|
|
|
10.
|
Federal income tax is withheld from employee earnings in all but two
states.
|
|
|
11.
|
The
marital status and withholding allowances of an employee affect the amount of federal income tax
withheld.
|
|
|
12.
|
No
employees are exempt from having federal income taxes withheld.
|
|
|
13.
|
Medicare is funded by the federal government but not under the social security
law.
|
|
|
14.
|
Social security tax is a federal tax paid by employees and employers for old-age,
survivors, and disability insurance.
|
|
|
15.
|
A
payroll ledger is a business form used to record payroll information.
|
|
|
16.
|
A
separate checking account for payroll checks helps to protect and control payroll
payments.
|
|
|
17.
|
A
business may decide to pay employee salaries every week, every two weeks, twice a month, or once a
month.
|
|
|
18.
|
Payroll time cards can be used as the basic source of information to prepare a
payroll.
|
|
|
19.
|
The
first task in preparing a payroll is to determine the number of days worked by each
employee.
|
|
|
20.
|
Payroll taxes are based on employee total earnings.
|
|
|
21.
|
Employee total earnings are calculated as regular hours x regular rate, plus overtime
hours x overtime rate.
|
|
|
22.
|
Employers in many states are required to withhold state, city, or county income tax
from employee earnings.
|
|
|
23.
|
Federal law requires that each employer have on file a properly completed Form W-2,
Employee's Withholding Allowance Certificate, for each employee.
|
|
|
24.
|
A
single person will have less income tax withheld than a married employee.
|
|
|
25.
|
Social security tax is paid by the employer only.
|
|
|
26.
|
An
act of Congress can change the social security tax base and tax rate at any time.
|
|
|
27.
|
When
an employee's earnings exceed the tax base, no more social security tax is deducted.
|
|
|
28.
|
All
deductions from employee wages are recorded in a payroll register.
|
|
|
29.
|
The
columns of the employee earnings record consist of the amount columns in a payroll register and an
accumulated earnings column.
|
|
|
30.
|
The
information used to prepare payroll checks is taken from a payroll register.
|
Multiple Choice
Identify the
letter of the choice that best completes the statement or answers the question.
|
|
|
31.
|
The
period covered by a salary payment is a ____. a. | bimonthly base | c. | pay period | b. | pay
schedule | d. | payroll | | | | |
|
|
|
32.
|
The
total amount earned by all employees for a pay period is a ____. a. | time
card | c. | wage | b. | salary | d. | payroll | | | | |
|
|
|
33.
|
The
total pay due for a pay period before deductions is ____. a. | gross
pay | c. | total
earnings | b. | gross earnings | d. | all of the above | | | | |
|
|
|
34.
|
Employee regular earnings are calculated as ____. a. | regular hours
times regular rate | c. | total hours plus
overtime rate | b. | total hours divided by regular
rate | d. | overtime hours
minus overtime rate | | | | |
|
|
|
35.
|
Until
payment is made, payroll taxes for an employer are ____. a. | an
asset | c. | capital | b. | a liability | d. | an expense | | | | |
|
|
|
36.
|
Federal income tax is withheld from employee earnings ____. a. | only in those
states electing to do so | b. | in all states with over 10,000,000
population | c. | only in states where a state income tax is
levied | d. | in all 50 states | | |
|
|
|
37.
|
All
employees must report their withholding allowances on a ____. a. | payroll
register | c. | Form
W-4 | b. | memorandum | d. | Form
W-2 | | | | |
|
|
|
38.
|
A
deduction from total earnings of each person legally supported by a taxpayer is a
____. a. | payroll
tax | c. | federal income
tax | b. | withholding
allowance | d. | worker's
allowance | | | | |
|
|
|
39.
|
The
withholding allowances of an employee affect ____. a. | social security
tax withheld | c. | federal
unemployment tax owed | b. | federal income tax withheld | d. | state unemployment tax owed | | | | |
|
|
|
40.
|
Medicare is for people who ____. a. | have a disability | c. | have reached retirement age | b. | are in the
hospital | d. | are under 50
years of age | | | | |
|
|
|
41.
|
Accurate and detailed payroll records ____. a. | do not have to
be retained | b. | must be maintained | c. | are the
responsibility of the employee, not the business | d. | none of the
above | | |
|
|
|
42.
|
A
business form used to record payroll information is ____. a. | a wage
register | c. | a payroll
register | b. | a payroll tax register | d. | an employee time card | | | | |
|
|
|
43.
|
Each
employee name is listed in a payroll register along with ____. a. | employee
number | c. | withholding
allowances | b. | marital status | d. | all of the above | | | | |
|
|
|
44.
|
Social security tax is calculated by ____. a. | multiplying
total earnings by the tax rate | b. | multiplying net earnings by the tax
rate | c. | using a tax
table | d. | none of the above | | |
|
|
|
45.
|
The
total earnings paid to an employee after payroll taxes and other deductions is recorded in the
payroll register ____. a. | Gross Pay column | c. | Net Pay column | b. | Total Earnings
column | d. | Total Deductions
column | | | | |
|
|
|
46.
|
Individual payroll checks are usually written on ____. a. | a company's
regular checking account | b. | a special payroll checking account | c. | a special
purposes account | d. | an employee earnings account | | |
|
|
|
47.
|
Some
businesses deposit employee net pay directly to each employee bank account by using
____. a. | payroll
checks | c. | EFT | b. | payroll registers | d. | none of the above | | | | |
|
|
|
48.
|
A
business form used to record details affecting payments made to an employee is ____. a. | an employee
earnings record | b. | a payroll journal | c. | an employee
accounts payable record | d. | a tax withholding form | | |
|
|
|
49.
|
The
Accumulated Earnings column of the employee earnings record ____. a. | shows net pay
for the year | b. | is the total earnings since the first of the
year | c. | shows net pay
for one quarter | d. | is the gross earnings for one quarter | | |
|
|
|
50.
|
The
amount on the employee earnings record used to determine if certain payroll taxes apply to an
employee's earnings is ____. a. | net pay | c. | gross earnings | b. | accumulated
earnings | d. | social security
taxes | | | | |
|