Answer the following questions:

3.- Payroll Tax Expense includes all the following except

a) FICA taxes (social security and Medicare)

b) federal unemployment taxes

c) state unemployment taxes

d) federal and state income taxes

4.- The amount of FICA social security and FICA- Medicare taxes an employer must pay is:

a) less than the amount withheld from the employee

b) not dependent on the amount withheld from the employee

c) equal to the amount withheld from the employee

d) greater than the amount withheld from the employee

6.- If Jordon Cords cumulative earnings before this pay period are $87,000 and he earned $ 500 this pay period; what amount will Jordon contribute to FICA? FICA tax rates are Social Security 6.2% on a limit $87,000 and Medicare is 1.45%

a) $32.05

b) $7.25

c) $38.25

d) none of these answers is correct

7.- The w-2 form must be distributed to each person by January 31 of the next year

True

False

8.- if the ending balance on the cash short/over account is a credit, if indicates that cash shortages have exceeded cash overages for the period

FALSE

9.- Most employers are levied a payroll tax for

FICA taxes, federal and state employment compensation tax

10.- the correct journal entry to record the payment of FUTA is to:

Debit FUTA Payavle, credit Cash

12.- The August bank statement for Mobile Service shows a balance of $8,900, but the balance per books shows a cash balance of $8,310. Other information includes

1.- A check for $10 was recorded on the books as $100

2.- Included on the bank statement was a note collected by the bank for $600 plus interest of $40

3.-Checks outstanding totaled $ 480

4.- Bank service charges were $20

5.- Deposits in transit were $600

Which item(s) should be subtracted from the balance per books?

Bank service charge and note collected by the bank

Checks outstanding and bank service charge

Bank service charge

Deposit in transit

14.- The payroll register contains:

a) payroll information for the payroll period

b) the total information for individual employees

c) the ledger accounts for payroll

d) all cumulative payroll information

15.- Jessica receives $350.00 pay for working 35 hours. What was Jessicas rate of pay per hour?

a) $8.35

b) $10.00

c) $ 9.00

d) $ 9.05

16.- The more allowance an employee claims on a W-4form, the more take home pay the employee gets witch each paycheck

True

False

18.- A summary record of each persons earnings, deductions, and net pay is called a(n):

a) payroll register

b) W-4

c) employee individual earnings record

d) general journal

19.- Determine de adjusted cash balance per bank for Marble Rental on March 31, form the following information:

Cash balance on the bank statement $ 2,700

Customers check returned-NSF 300

Customers note collected by the bank 500

Deposit in transit, March 31 1,750

Outstanding checks, March 31 2,200

3,200

2,900

2,700

2,250

20.- The debit recorded in the journal to establish the petty cash fund is to

a) Cash

b) petty cash

c) accounts receivable

d) accounts payable

21.- Farrs Musical Groups cash register tapes do not agree with cash receipts. The facts are total cash register tapes $600, total coins and currency $605. The summary journal entry to record the days transactions would include a:

a) $600 debit to cash, $5 debit to cash short/over, and $605 credit to Sales

b) $605 debit to cash, $5 credit to cash short/over, and $600 credit to sales

c)$605 debit to cash and $605 credit to sales

d$600 debit to cash and $600 credit to sales

22.- A $100 petty cash fund has cash of $14 and valid receipts for $82. The entry to replenish the fund would include a

Debit to cash for $82

Credit to cash for $82

Debit to petty cash for $86

Debit to cash short/over for $4

23.- One internal control safeguard is to assign all the duties of receiving, depositing, and recording cash to one employee

True

False

24.- The original amount of the petty cash fund should equal

a) The sum of the petty cash on hand and the paid cash vouchers

b) cash on hand at the end of the day

c) the cash received plus the cash in the petty cash box

d) the total payments made during the day

25.- Different deposit rules apply to employees based on the amount collected and owed by the employer

True

False

26.- Jason Moss earns $36,000 per year. What is his net pay for the month ended January 31, if FICA tax are 6.2% for Social Security and 1.45% for Medicare federal income tax is 20% and union dues are $100 per month?

a) $2,680.10

b) $2,350.80

c) $2,070.50

d) $1,880.10

27.- Credit memorandum from the bank

a) decrease a bank customers account

b) are used to show a bank service charge

c) show that a company has deposited a customers NSF check

d)show the bank has collected a note receivable for the customer

28.- The bank reconciliation

a) should be prepared by an employee who records cash transactions

b) is part of the internal control system

c) is for information purposes only

d) is sent to the bank for verification

29.- An insufficient funds check was returned to your company. How does the bank treat on your bank statement?

a) it is added to the bank balance

b) it is shown as a debit memo

c) it is shown as a credit memo

d) none of these answers is correct

30.- How would outstanding checks be handled when reconciling the ending cash balance per the bank statement to the correct adjusted cash balance?

a) they would be added to the balance of the bank statement

b) they would be subtracted from the balance of the bank statement

c) they would be added to the balance per books

d) they would be ignored

31.- Bank interest earned on a checking account cash balance would be shown on a bank reconciliation as:

a) added to the balance per books

b) deducted from the balance per books

c) added to the balance per bank statement

d) deducted from the balance per bank statement

32.- What type or an account is the petty cash found?

Revenue

Expense

Asset

Liability

33.- If a check marked NSF is received from the bank, an adjusting entry crediting cash is needed

True

False

34.- Which of the following bank reconciliation items would not be reflected in a journal entry?

a) bank service charge

b) collection of a note by the bank

c) outstanding checks

d) NSF customer check

35.- Both employer and employee contribute to FUTA tax

True

False

36.- Using correct cash handing procedures, deposits should be made by the end of the week

True

False

37.- Deposits that have been added to the bank balance but not the checkbook balance are called deposits in transit

True

False

38.- Computers of the Future payroll for June includes the following data

Gross salaries $30,000

Salaries subject to FICA 30,000

6.2% Social Security

1.45% Medicare

Salaries subject to:

FUTA 0.8% 8,000

SUTA 2.7% 8,000

The employers payroll tax for the period would be

$280

$2,295

$2,575

$2,875

39.- A fund that is placed in the cash register drawer and used to make change for customers who pay cash is called a

a) petty cash fund

b) change fund

c) cash short/over fund

d) electronic funds transfer

40.- There are two parts to FICA

a) old age benefits and workers compensation

b) retirement and income tax withholdings

c) social security and Medicare

d) all of these answers are correct

41.- Kathryn Holmes cumulative earnings are $45,000 and her gross pay for the week is $500 if the FICA rates are Social Security 6.2% on a limit Security and FICA-Medicare taxes for the week?

a) $31.00 $7.25

b) $310.00 $72.50

c) $3.10 $0.73

d) $25.50 $8.00

42.- The balance in the Salaries and Wages Payable account is equal to net pay

True

False

43.- The Federal Unemployment Tax is

a) paid by the employer

b) paid by employees

c) paid by unemployed workers

d) all of these answers are correct

44.- Calculate from the following information accumulated by Mary Jones, the adjusted cash balance at the end of August

Bank statement ending cash balance $2,500

General ledger cash balance ending 2,750

Bank monthly service charge 20

Deposit in transit 1,400

Outstanding checks 1,235

NSF check returned with bank statement 65

$2,665

$2,500

$2,750

$2,435

45.- Which of the following statements is true?

a) Payroll tax Expense is an expense account

b) FICA- Social Security Tax Payable increases on the credit side of the account

c) Payroll Tax Expense increases on the debit side of the account

d) All of these answers are correct

46.- To compute FICA Social Security tax to be withheld

a) use the net earnings and number of allowances

b) use gross earnings, number of allowances and marital status

c) use net earnings and Form W-4

d) none of these answers is correct

47.- The Wages and Salaries Expense account would be used to record

a) net earnings for the office workers

b) a credit to the amount owed to the office workers

c) gross earnings for the office workers

d) a debit for the amount of net pay owed to the office workers

48.- The entry to record the payment of payroll taxes withheld from employees and FICA taxes would be to:

a) credit cash, debit FICA-Social Security Payable, FICA-Medicare Payable and Federal Income Tax Payable

b) debit cash, credit FICA-Social Security Payable, FICA-Medicare Payable, and Federal Income Tax Payable

c) credit Cash, credit FICA-Social Security Payable, FICA-Medicare Payable, and Federal Income Tax Payable

d) none of these answers is correct

49.- Mary Gross hourly rate is $10.00 and she worked 44 hours during the week. Assuming an overtime rate of the time and a half over 40 hours. Marys gross pay is

a) $400

b) $460

c) $430

d) $350

50.- Marcys cumulative earnings before this pay period were $6,200, and gross for the week is $500. How much of this weeks pay is subject to taxes for SUTA is 5.4%and FUTA is 0.8% with a base of $7,000

a) $300

b) $500

c) $6,700

d) $0

51.- Under the Fair Labor Standards Act, for any hours that an employee works over 40 during a work

a) the employee must be paid double

b) the employee is paid time and a half

c) the employee must receive the minimum wage

d) all of these answers are correct

52.- A form completed by employees showing the number of allowances is

a) form W-2

b) form 941

c) form W-4

d) form 8109

53.- The normal balance of the Petty Cash account is a credit

True

False

54.- Accompanying the bank statement was a debit memorandum for bank charges. On the bank reconciliation the item

a) a deduction from the balance per depositors records

b) an addition to the balance per bank statement

c) a deduction from the balance per bank statement

d) an addition to the balance per depositors records

55.- For which of the following taxes is there no ceiling on the amount of employee annual earning

a) FICA-Social Security

b) FICA-Medicare

c) Federal Unemployment Tax

d) State Unemployment Tax

56.- On December 1, Diane Olson does not have and FICA-Social Security tax withheld from her earnings. What is the most likely reason?

a) Diane has already made over the FICA-Social Security limit for the year

b) An error was made if no FICA-Social Security and FICA-Medicare was withheld

c) Dianes number of allowance withholdings claimed was high

d) Diana owes no federal income tax for the period

57.- The amount of federal income tax withheld from an employees during the year is determined by the employees

a) W-4 form

b) W-2 form

c) 1040 form

d) None of these answers is correct

58.- An employee has gross earnings of $700 and withholdings of $53.55 FICA Social Security and Medicare) and $50 for income taxes. The employer pays %53.55 FICA (Social Security and Medicre) $10 for SUTA, and $5.60 FUTA. What is the employers total cost of the employee?

a) $780.00

b) $769.15

c) $819.15

d) $905.55

59.- Which of the following would not typically be an employee payroll withholding?

a) Union dues

b) Purchases of savings bonds

c) Federal income tax

d) Unemployment taxes

60.- Company policy for internal control should include all of the following except

a) Employees will be rotated

b) The owner (or responsible employee) signs all checks after receiving authorization to pay from

c) At time of payment al supporting invoices or documents will be stamped paid

d) One employee should have the total responsibility for approving purchases, authorizing payment

61.- The entry to record the employers payroll tax is to

a) debit payroll taxes payable, credit FICA (social security and Medicare) SUTA FUTA Payable

b) debit Payroll taxes expense, credit FICA (Social security and Medicare) FUTA SUTA Payable

c) debit FICA (social security and Medicare) SUTA FUTA Payable, credit payroll taxes payable

d) debit FICA (social security and Medicare) SUTA FUTA Payable, credit payroll taxes expense

62.- The bank statement shows

a) the beginning bank balance of the cash at the start of the month

b) the checks the bank has paid and any deposits received

c) any other charges or additions to the bank balance

d) all of these answers are correct

63.- The August bank statement for Mobile Service shows a balance of $8,900 but the balance per books shows a cash balance of $ 8,310

1. A check for $10 was recorded on the books as $100

2. Included on the bank statement was a note collected by the bank for $600 plus interest of 40

3. Checks outstanding totaled $480

4. Bank service charges were $20

5. Deposits in transit were $600

Which item(s) will require an adjustment to the cash account?

Checks outstanding and deposits in transit

Bank service charges note collected by the bank and error made by Mobile

Bank service charges note collected by the bank, and deposits in transit

None of these answers is correct

64.- A check for $78 is incorrectly recorded on the checkbook stub as $87. The $9 error should be shown on the bank reconciliation

a) added to the balance per books

b) deducted from the balance per books

c) added to the balance per bank statement

d) deducted from the balance per bank statement

65.- The payroll taxes the employer is responsible for are,

a) FICA, SUTA and FUTA

b) FICA, FIT, and SIT

c) FICA, workers compensation and FIT

d) None of these answers is correct

66.- When a bank debits your account, it is decreasing the balance

True

False

67.- An employer can reduce the state unemployment tax rate by providing steady employment for the employees

True

False