Questions and Answers of Payroll Accounting

What are the self-employment tax rates for 2018? Explain how the tax is computed.
What is a personal allowance? What was the amount of a personal allowance for 2018?
Under what conditions may employees be exempt from the withholding of federal income taxes during 2018? How do such employees indicate their no-tax-liability status?
In 2018: a. Which state had the widest range of SUTA tax rates for employers? b. Which state paid the highest weekly maximum benefit (excluding dependency allowances) to qualified
John Luis receives wages from three employers during 2019. Is he entitled to a refund on the OASDI taxes paid on wages in excess of the taxable wage base? If so, how can he receive a refund?
Haley Price is an employee at Finesong Jewelry. She earns a salary of $38,850 per year, paid biweekly, and has a credit card garnishment. Assuming that Haley’s disposable income is 85 percent of
Gail Richter worked the following schedule: Monday, 7 hours 42 minutes; Tuesday, 8 hours 23 minutes; Wednesday, 9 hours 28 minutes; Thursday, 8 hours 12 minutes; Friday, 8 hours 6 minutes. The
Elaine Wheeler needs additional filing space at the end of the year in the company’s office and chooses to use off-site, secured storage. Upon arriving at the storage facility, she discovers that
Kirk McAllister earns $15.30 per hour at Jolly Creamery. Compute his pay under both the hundredth-hour and quarter-hour systems. The company is considering switching from a quarter-hour method to a
Dan Nicholes is a commission-based employee who is married filing jointly with two other dependents. He is paid $17.25/hour and receives a 7 percent commission on net sales. He does not receive
Richard Cox is a new employee at Big Tech Computers. He is debating whether he should enroll in a POP with the opportunity for an FSA or an HDHP with an opportunity for an HSA. The POP premium is
Jeremiah Watson is a salaried, exempt employee with Mega department Stores. He is single with one dependent under 17 and earns $35,500 per year. Complete the payroll register for the biweekly pay
Ruth Garcia is a children's photographer for Midlands Photography Studios. She would like advice about using an FSA for miscellaneous prescriptions and other medical expenses. What reason(s) would
Orlando Collier is employed as a concierge at Strawberry Lodge, an upscale resort in the Adirondack Mountains. He asks you, the payroll accountant, which deductions from his pay are considered
Jordy Richman is employed at Rockstar Music. Jordy is receiving education assistance of $5,750 per year from Rockstar Music to complete a bachelor’s degree from an accredited college. How much of
John Cotton is an employee at Radiance Senior Living. He received the following benefits from his employer during 2021 on the company's location for company purposes:Personal protective equipment:
Mike Mallin is an employee of All-Adventure Tours. All-Adventure Tours offers tuition reimbursement as a fringe benefit. What is the maximum amount that may be excluded from his taxes as a fringe
Rodney Atwater is a sales representative for American Silk Mills. Because he visits customer sites, he has a company car. He drove 25,500 miles during 2021, of which he reported 15 percent was
Juan Potter is an employee of Convergent Technologies whose job is strictly based in the company’s office. His employer has authorized his use of a company vehicle for commuting purposes, as
Janice Lucas is the president of Miller Custom Coffee Roasters. She drives a 2020 Mercedes E300 with a fair market value of $57,500. The lease value is $14,750. The odometer started at 655 and was
Eric Rubin is the payroll accountant of Central Communications. He is researching retirement plan options for his employer. Central Communications has 135 employees and is a for-profit company. Which
Ari Friedman is an employee at Ruby Investments, with an annual salary of $92,500, paid biweekly. Ari has the following fringe and voluntary benefits:Medical insurance: $400 per month401(k): 3
Joy Warren is an employee at Jankoski Cycles. She earns a salary of $37,765 annually, paid semimonthly. She contributes to the following fringe benefits and other deductions:Medical insurance: $220
Kerry Palmer is reviewing benefits with you, the payroll accountant for Silly Lemon Films. Classify the following benefits in which she is interested as pre-tax or post-tax deductions and as taxable
By what date must a company declare the value of noncash benefits used in 2021?a. January 1, 2022b. December 31, 2022c. February 1, 2022d. January 31, 2022
Elijah Hamilton is the payroll accountant at White Box Builders. He is preparing an information package about voluntary and fringe benefits. Using the following list of fringe benefits, classify each
Chloe Ayers has received a court order for garnishment for her student loan payments. What must be considered in computing the garnishment?a. Year-to-date payb. Hourly wagec. Disposable incomed. Pay
What is the Social Security wage base for 2021?a. $128,400b. $132,900c. $137,700d. $142,800
Scout Freeman is the vice president for marketing at Sun Field Industries. She earns $160,000 annually and is paid on a semimonthly basis. As of November 15, Scout has year-to-date earnings of
Renee Signorini works for New & Old Apparel, which pays employees on a semimonthly basis. Renee's annual salary is $184,000. Calculate the following: Pay Date October 15 December
Margaret Wilson is the new accountant for a start-up company, Peaceful Skunk Builders. The company has cross-country drivers, warehouse personnel, and office staff at the main location. The company
Jeremiah Seafort of All Grains Bakery is considering offering additional payroll disbursal methods for his employees. Which of the following would be the safest for employees without a bank
As of 2021, which of the following accurately represents the full FUTA rate and wage base?a. 0.6 percent, $142,800b. Varies by statec. 6.0 percent, $7,000d. 0.6 percent, $7,000
Davis Reyes is the accountant for Heads Up Hat Corporation. As he prepares the payroll for the semimonthly pay period ending December 15, he notices that some of the year-to-date executives’
Deshawn Booker is a payroll clerk at Elemental Exports. The company receives written notice from the IRS that the company is a monthly schedule depositor. How is the deposit schedule determined?a.
Maura Hatton is a payroll accountant with Scottish Traders Inc. One of her colleagues poses a question about the legality of the deduction for Social Security tax from her pay. What should Maura tell
Jackson Wyman was dismissed from his employment at Precision Dynamics because of an incident regarding his race. Mr. Wyman sued Precision Dynamics for $150,000 because of the discrimination. Which of
Gina Harris is a payroll accountant at Sucre Foods. She works remotely from her home office, communicates with colleagues via Zoom, and has a VPN to prevent her computer data from hackers. Which
Match the following terms with their definitions:Auditora. A preloaded credit card is used to pay employees.b. The process of gathering information about hours worked for one or more employees.c. A
Match the following terms with their definitions:Manual payrolla. A preloaded credit card is used to pay employees.b. The process of gathering information about hours worked for one or more
Rubin Schaub is a payroll accountant who works for a private firm. He completed his most recent professional development course in 2005. Which of the following ethical issues has he
Match the following terms with their definitions:Time collectiona. A preloaded credit card is used to pay employees.b. The process of gathering information about hours worked for one or more
Roland Wexler was terminated for cause from Santel Auto Parts in North Carolina on July 20, 2021. As of the date of his termination, he had worked 22 hours of regular time. Employees at Santel Auto
Reuben Walker is a part-time worker for Senior Solvers who uses company equipment in the performance of his job duties. He asks the payroll supervisor, Gina Turner, to grant him independent
Michael Hatton is a salaried employee earning $49,850 annually. He receives his payroll twice per month. Which of the following best describes the pay frequency?BiweeklySemimonthlyWeeklyMonthly
Sara Northman is a member of the Algonquin Indian Nation and is a new employee at Predeo Game Designs. During the process of completing her I-9, she claims that the only way to prove her identity is
On June 21, 2021, Dolores Goodman was terminated from her job at Black Diamond Sports in New Hampshire. Black Diamond Sports pays its employees biweekly on Fridays, and the next payday is 7/2/2021.
Bobby Howard is a salaried exempt employee at Coric Industries. He is married filing jointly with two dependents under 17. His contract stipulates a 40- hour workweek at $47,500 per year.
Leonard Andrews ended his employment with Atlas Inks on March 20, 2021. When is the earliest that Atlas Inks may destroy his payroll records?March 21, 2022March 21, 2023March 21, 2024March 21, 2025
What two regulations pertain to employee paycard use?
Lynne Everton is a minimum wage worker in Oklahoma. She is contemplating moving to a state with a more favorable minimum wage. Which of the following states should she
Terry McNutt, a single employee with two dependents under the age of 17, is paid $12 per hour and receives a commission on net sales. He does not receive a commission until his net sales exceed
Ashley Woods is a tipped employee in Washington, DC. What is the minimum tipped wage for her location?$2.13/hour$3.25/hour$4.75/hour$5.05/hour
Gail Schneeweis is a nurse at Central City Hospital. She is paid $32.50 per hour and has a 40-hour standard workweek. During the biweekly pay period from January 11-24, she worked a total of 87
Latanya Brown is an employee of Giant Computers, where her job responsibilities include selling computers and software to customers. Latanya is married filing jointly with two dependents under 17.
On the financial statements prepared at the end of its first year of operations, the company must show an accurate picture of all expenses and all liabilities incurred. The last payday of the year
O’Neill has decided to give all current employees (excluding himself) a bonus payment during January equal to 5% of their total gross pay for last year. Determine the total of this bonus payment
The amount of the group insurance premiums collected from employees during the quarter ended December 31 was ..................................$
In this last phase of your work on the Continuing Payroll Problem B, you will record the amounts withheld for group and health insurance and calculate the net pay for each employee. Refer to the
In this last phase of your work on the Continuing Payroll Problem A, you will record the amounts withheld for group and health insurance and calculate the net pay for each employee. Refer to the
In Oregon, employers who are covered by the state workers’ compensation law withhold employee contributions from the wages of covered employees for the workers’ benefit fund at the rate of 1.65¢
On December 31, 2016, Santucci Company has a balance of $619.24 in the FUTA taxes payable account. This represents the employer’s liability for the fourth quarter taxes. Journalize the entry
Carmen Santos is owner and sole employee of CS Corporation. He pays himself a salary of $2,400 this week.
Purnell, Inc., has a semimonthly payroll of $53,900 on September 15. The total payroll is taxable under FICA Taxes—HI; $50,400 is taxable under FICA Taxes—OASDI; and $7,300 is taxable under
The form on page 6-45 shows the amounts that appear in the Earnings to Date column of the employees’ earnings records for 10 full-time and part-time workers in Unger Company. These amounts
In Oregon, employers who are covered by the state workers’ compensation law withhold employee contributions from the wages of covered employees for the workers’ benefit fund at the rate of 1.65¢
On December 31, 2016, Reuter Company has a balance of $98.75 in the FUTA taxes payable account. This represents the employer’s liability for the fourth quarter taxes. Journalize the entry Reuter
Refer to the partially completed payroll register that you worked on at the end of Chapter 4. You will now compute the employer’s liability for unemployment taxes (FUTA and SUTA) for the pay of
Refer to the partially completed payroll register that you \\worked on at the end of Chapter 4. You will now compute the employer’s liability for unemployment taxes (FUTA and SUTA) for the pay of
The information listed below refers to the employees of Brennan Company for the year ended December 31, 2016. The wages are separated into the quarters in which they were paid to the individual
As the accountant for Monroe Trucking Company, you are preparing the company’s annual return, Form 940 and Schedule A. Use the following information to complete Form 940 and Schedule A on pages
Applebaum Security Company is located in State H, which enables employers to reduce their contribution rates under the experience-rating system. From 2002 to 2011, inclusive, the company’s total
The following unemployment tax rate schedule is in effect for the calendar year 2016 in State A, which uses the reserve-ratio formula in determining employer contributions:
The following unemployment tax rate schedule is in effect for the calendar year 2016 in State A, which uses the reserve-ratio formula in determining employer contributions:
Under what conditions may employees be exempt from the withholding of federal income taxes during 2015? How do such employees indicate their no-tax-liability status?
What is a personal allowance? What was the amount of a personal allowance for 2015?
Refer to the partially completed payroll register which you worked on at the end of Chapter 3. You will now determine the amount of income tax to withhold for each employee, proceeding as follows:1.
Refer to the partially completed payroll register which you worked on at the end of Chapter 3. You will now determine the amount of income tax to withhold for each employee, proceeding as follows:1.
Harrington Company is giving each of its employees a holiday bonus of $250 on December 16 (a nonpayday). The company wants each employee’s check to be $250. The supplemental tax percent is useda.
Assume during the quarter ending December 31 of the current year, Matson Office Systems had 13 weekly paydays and three monthly paydays. Using the data given in 4-8B, complete the following form to
The names of the employees of Hogan Thrift Shop are listed on the following payroll register. Employees are paid weekly. The marital status and the number of allowances claimed are shown on the
At Gleeson Brewing Company, office workers are employed for a 40-hour workweek on either an annual or a monthly salary basis.Given on the form below are the current annual and monthly salary rates
Yelman Company is a monthly depositor whose tax liability for June 2016 is $3,930.1. What is the due date for the deposit of these taxes?
The taxable wages and withheld taxes for Hamilton Company (EIN 00-0001462), semiweekly depositor, for the first quarter of 2016 follow.a. Complete Schedule B of Form 941 on page 3-65 for the first
Refer to Problem 3-11B. Complete Parts 2, 4, and 5 of Form 941 (on page 3-57) for Gallagher Company for the third quarter of 2016. Gallagher Company is a monthly depositor with the following monthly
Gallagher Company has gathered the information needed to complete its Form 941 for the quarter ended September 30, 2016. Using the information presented below, complete Part 1 of Form 941, reproduced
The monthly and hourly wage schedule for the employees of Quincy, Inc., follows. No employees are due overtime pay. Compute the following for the last monthly pay of the year:a. The total wages of
Haggerty Company pays its salaried employees monthly on the last day of each month. The annual salary payroll for 20-- follows. Compute the following for the payroll of December 31:
Eric Sherm began working as a part-time waiter on April 1, 2016, at Yardville Restaurant. The cash tips of $475 that he received during April were reported on Form 4070, which he submitted to his
How are the funds used which are provided by FUTA and SUTA?
Damerly Company (a California employer) wants to give a holiday bonus check of $250 to each employee. Since it wants the check amount to be $250, it will need to gross-up the amount of the bonus.
The names of the employees of Hogan Thrift Shop are listed on the following payroll register. Employees are paid weekly. The marital status and the number of allowances claimed are shown on the
Refer to the partially completed payroll register you started at the end of Chapter 2. You will now determine the amount of FICA taxes to be withheld from each employee’s pay for the pay period
Trinidad Schwab is an employee at Kyletown Fire Department. He received the following benefits from his employer during 2018 for company purposes:On-site housing, $250 per monthEmployer-provided cell
Keren Wiseman is an employee of Dimension works Designs in New Mexico. She received the following achievement awards from her employer during 2018:Best Design, Santa Fe County: $1,200Top Graphic
Motor vehicle service technicians usually must provide their own tools as part of their employment. These tools are the property of the technician, and service technicians generally receive an hourly
Hayim Accardi is the accounting manager for a small, local firm that has full- and part-time staff. What must Haymin consider when classifying employees as exempt or nonexempt?
Refer to the partially completed payroll register you started at the end of Chapter 2. You will now determine the amount of FICA taxes to be withheld from each employee’s pay for the pay period
Refer to the partially completed payroll register which you worked on at the end of Chapter 3. You will now determine the amount of income tax to withhold for each employee, proceeding as follows: 1.
You will now determine the amount of income tax to withhold for each employee, proceeding as follows:1. In the appropriate columns of your payroll register, record the marital status and number of

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