Main content Appendix Contents VI. Project Audit Tests NOVEMBER 20 PAYROLL: (Answers are provided below for the Illustrative Case.) Payroll Register 1. What is the amount of FIT withheld for Dewey W. Mann? $ 65.00 2. What is the total amount of SUTA withheld this period for all employees? $ 8.34 3. What is the total gross pay for all employees? $ 13,922.09 Journal 4. What is the November 16 credit to Cash for the deposit of FICA & FIT taxes? $ 6,575.02 5. What is the amount of the debit to Payroll Taxes? $ 1,131.00 6. What is the November 16 debit to Employees CIT Payable? $ 1,215.29 General Ledger 7. What is the balance of Employees SIT Payable? $ 427.43 8. What is the amount of Office Salaries paid to date? $ 47,735.33 9. What is the balance of Simple Contributions Payable? $ 1,650.00 10. What is the Cash account balance? $142,827.44 DECEMBER 4 PAYROLL: (As you complete your work, answer the following questions for the December 3 and December 4 payroll.) Payroll Register 1. What is the net pay for Joseph T. ONeill? __________________ 2. What is the amount of OASDI withheld for Norman A. Ryan? __________________ 3. What is the total net pay for all employees? __________________ 4. What is the total CIT withheld for all employees? __________________ Journal 5. What is the amount of the debit to Employees SIT Payable on December 3? __________________ 6. What is the amount of the credit to Employees FIT Payable? __________________ 7. What is the amount of the debit to Payroll Taxes? __________________ General Ledger 8. What is the balance of SUTA Taxes PayableEmployer? __________________ 9. What is the balance of Employees CIT Payable? __________________ 10. What is the Cash account balance? __________________ DECEMBER 14 PAYROLL: (As you complete your work, answer the following questions for the December 9 and December 14 payroll.) Payroll Register 1. What is the amount of FIT withheld for Virginia A. Russell? __________________ 2. What is the amount of net pay received by Virginia A. Russells estate? __________________ 3. How many withholding allowances did Virginia A. Russell claim? __________________ Journal 4. What is the amount of the debit to Union Dues payable on December 9? __________________ 5. What is the amount of the debit to Payroll Cash? __________________ 6. What is the amount of the credit to Employees SUTA Payable? __________________ General Ledger 7. What is the amount that was credited to Group Insurance Premiums Collected (account number 27) during this period? __________________ 8. What is the amount paid for office salaries to date? __________________ 9. What is the balance of FICA Taxes PayableOASDI? __________________ 10. What is the balance of Payroll Taxes? __________________ DECEMBER 18 PAYROLL: (As you complete your work, answer the following questions for the December 15 through December 18 payroll.) Payroll Register 1. What is the amount of FIT withheld for Joseph T. ONeill? __________________ 2. What is the total current net pay for all employees? __________________ 3. What is the total gross pay for all employees? __________________ 4. What is the taxable amount of Joseph T. ONeills gross pay for OASDI? __________________ Journal 5. What is the amount of the credit to Cash for the deposit of FICA and FIT taxes on December 15? __________________ 6. What is the amount of the debit to Payroll Taxes? __________________ 7. What is the amount of the debit to Employees CIT Payable on December 15? __________________ General Ledger 8. What is the Cash account balance? __________________ 9. What is the total amount of Plant Wages to date? __________________ 10. What is the total amount of Payroll Taxes to date? __________________ END-OF-YEAR ACTIVITIES Journal 1. What is the amount of the deposit for Pennsylvania state income taxes withheld from the December 18 payroll? __________________ 2. What is the amount of FICA Taxes PayableOASDI deposited from the December payrolls? __________________ 3. What is the amount of the city of Philadelphia employees income tax deposited from the December payrolls? __________________ 4. What is the amount of FUTA Taxes Payable deposited for the quarter? __________________ 5. What is the amount of the credit to Cash for SUTA Taxes Payable for the fourth quarter? __________________ Payroll Adjusting Entries 6. What is the amount of the credit to Salaries and Wages Payable for the December 31 adjusting entry? __________________ 7. What is the amount of the debit to Vacation Benefits Expense for the December 31 adjusting entry? __________________ Calculations 8. What is the total payroll tax expense incurred by the employer on salaries and wages paid during the quarter ended December 31? __________________ 9. What is the total payroll tax expense incurred by the employer on the total earnings of Joseph T. ONeill during the fourth quarter? __________________ 10. ONeill 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. What is the total of this bonus payment? As of December 31, the vacation time earned but not used by each employee is listed here. Bonno 80 hours Ferguson three weeks Ford two weeks Mann one week ONeill four weeks Ryan 80 hours Sokowski two weeks Student 72 hours Woods none Young none Zimmermann Net Paid $10,948.37 December 3 Deposit with the state of Pennsylvania the amount of state income taxes withheld from the November payroll. (Transaction No. 18) December 4 Prepare the payroll using the Time Clerks Report Nos. 46 and 47. Note: Thursday, November 26, is a paid holiday for all workers. Complete the Payroll Register; journalize transfer of cash to the Payroll Cash account, the payroll entry, and payroll tax entry; post the amounts to the General Ledger accounts; and update the Employees Earnings Records. Due to the birth of a son, Anthony V. Bonno has completed a new Form W-4 increasing his withholding allowances to five. Change Bonnos withholding allowance section on his earnings record to 5. This change is effective with the December 18 pay. Increase the union dues to $9 each pay on Bonnos and Ryans earnings records. This change is effective on the last pay of the year (December 18). December 9 Pay the union treasurer the amount of union dues withheld during the month of November. December 11 The payroll department was informed Virginia Russell died in an automobile accident on the way home from work on Thursday, December 10. December 14 Project Audit Test Net Paid $2,194.72 A special payroll needs to be completed to process Russells final paycheck made payable to the Estate of Virginia A. Russell. This check covers Russells work for the weeks ending December 5 and 12 ($1,134.00) plus her accrued vacation pay ($1,260.00). Do not show the vacation hours in the Time Record columns on the payroll register, but include them in the Regular Earnings column. Russells final biweekly pay is subject to FICA, FUTA, and SUTA. This final pay is not subject to FIT, SIT, or CIT. Since Russells cumulative earnings have surpassed the taxable earnings figures for FUTA and SUTA, there will not be any unemployment tax on the employer. The deduction for group insurance is $14.70 [($49,000/$1,000) $.30]. Make a notation of Russells death on the Payroll Register and her Employees Earnings Record. Prepare all the entries for the special pay; post to the General Ledger accounts and Employees Earnings Records. If required by your instructor complete: Form W-2 (Transaction No. 24): Include the final gross pay in Boxes 3 and 5, but not in Boxes 1, 16, and 18. This Form W-2 will be given to the executor of the estate along with the final paycheck. Russells address is 8004 Dowling Road, Philadelphia, PA 19135-9001. Form 1099-MISC and Form 1096 (Transaction No. 41 and No. 42) will be completed in February before their due date to report the last wage payment and vacation pay ($2,394.00). December 15 Electronically deposit the amount of FICA taxes and federal income taxes for the November payrolls. (Transaction No. 25) Deposit with the city of Philadelphia the amount of city income taxes withheld for the November payrolls. (Transaction No. 26) December 18 Deposit with the state of Pennsylvania the amount of state income taxes withheld from the December 4 payroll. (Transaction No. 27) Glo-Brite received notification there will be no premium charge for the month of December on the policy for Virginia Russell. Prepare an entry for a check payable to the estate of Virginia A. Russell for the amount withheld for insurance from her December pay. Prepare an employees earnings record for Richard Lloyd Zimmerman who was employed starting today to take Virginia Russells place. Richard Lloyd Zimmerman Married claiming one withholding allowance 900 South Clark Street $2,600 per month Philadelphia, PA 19195-6247 $600.00 per week Phone: 555-2104 $15.00 per hour Soc. Sec. No.: 000-00-1502 Group ins.: $47,000 beginning next year Department: Office Position: Time Clerk Project Audit Test Net Paid $47,650.34 Using the information from the Time Clerks Report Nos. 48 and 49, prepare the last pay for December and record the paychecks issued all employees. Also, record the employers payroll taxes. Effective with this pay, ONeill completed a new Form W-4. Change his earnings record withholding allowances to 4. He had previously claimed fewer allowances than he was entitled to claim. In this pay, ONeill is paid his annual bonus of $75,000. This does not affect his group insurance coverage. For withholding purposes, the bonus is considered a supplemental payment and is added to his gross pay and the aggregate is taxed. ONeill changed his SIMPLE contribution this pay to $4,000. To determine his FIT this period, you must use the Table of Allowance Values along with Tax Table 2Biweekly Payroll Period (Tax Table). In calculating the tax, do not round the aggregate to the nearest earnings dollar. In this pay, ONeill has reached the OASDI ceiling. To calculate ONeills OASDI tax, multiply the OASDI ceiling of $128,400 by 6.2 percent and then subtract the OASDI taxes withheld up to this pay. Note: After posting the information for this last pay to the Employees Earnings Records, the quarterly and yearly totals on each earnings record will automatically be calculated using the protected formulas. Change font size A small font A medium font A large font Add Bookmark to this Page help ?