True or false: There is a ceiling on each employee's annual earnings that are subject to federal income taxes.

To which of the following payroll taxes are employers required to contribute a matching portion for each employee?

a.Workers' Compensation

b.State unemployment

c.Federal unemployment

d.Social Security & Medicare

e.All of these choices are correct.

If a tax payment is made, what is the effect on the FICA Taxes Payable Account?

a.Decrease with a, CR

b.Increase with a, DR

c.Increase with a, CR

d.Decrease with a, DR

Employees, as well as employers, are required to make payments toward federal unemployment insurance.

True

False

Required employee payroll deductions include income taxes, FICA taxes, union dues, and charitable contributions.

True

False

The 941 tax return form is reported ___________.

a.Semi-Weekly

b.Monthly

c.Quarterly

d.Annually

Which of the following is debited in the journal entry to record the payment of the taxes shown on the quarterly 941 tax form?

a.SUTA Tax Receivable (only employee), FICA Medicare Tax Payable, and Federal Income Tax Payable

b.FICA Social Security Tax Payable, FICA Medicare Tax Payable, and Employee's Federal Income Tax Payable

c.Only Federal Income Tax Payable

d.Federal Unemployment Tax (FUTA) Payable (only employee) and Federal Income Tax Payable

e.Only Cash

FUTA tax liability is generally deposited _________ and reported ___________.

a.Weekly, Monthly

b.Quarterly, Annually

c.Monthly, Quarterly

d.Deposits and Report Dates Vary

Extra hours that are added to wage information in order to increase pay is an example of:

a.False Expense Reimbursement Fraud

b.False Wage Claim Fraud

c.Ghost Employee Fraud

d.None of these choices are correct.

Tom James has cumulative earnings of $6,825 and earned $750 during the current payroll period. The FUTA tax is 0.6%, with a ceiling of $7,000. What is the employers federal unemployment tax liability for the current payroll:

a.$1.05

b.$105.00

c.$175.00

d.$10.50

There is no wage ceiling limit for which of the following:

a.FUTA

b.FICA Medicare

c.SUTA

d.FICA Social Security

A debit to the Payroll Tax Expense account means:

a.The employer's payroll taxes have decreased

b.The employer's payroll taxes have increased

c.Both the employer's and the employee's payroll taxes have increased

d.The employer's and employee's payroll taxes have not changed

FUTA is an abbreviation for:

a.Future Unemployment Tax Act

b.Federal Unemployment Tax Act

c.Funding Unemployment Tax Act

d.None of these choices are correct.

Payments for state taxes are submitted to the state agency involved.

True

False

Which of the following entries records an employer's payroll taxes?

a.Debit to Federal Expense, credit to Cash

b.Debit to Payroll Tax Payable, credit to Cash, credit to Federal Unemployment Tax Payable, and credit to State Unemployment Tax Payable

c.Debit to Federal Unemployment Tax (FUTA) Payable, Debit to State Unemployment Tax (SUTA) Payable, and credit to Payroll Tax Expense

d.Debit to Payroll Tax Expense, credit to FICA Social Security Tax Payable, credit to FICA Medicare Tax Payable, credit to Federal Unemployment Tax Payable, and credit to State Unemployment Tax Payable

Payroll Tax Expense includes all of the following EXCEPT:

a.FICA Taxes Payable

b.Federal Income Tax Withheld

c.SUTA

d.FUTA

The source of information to complete the W-2 form is the employee's individual earnings record.

True

False

Which of the following frauds refers to recording of someone in the payroll system who does not work for the business?

a.Employee expense fraud

b.Not hired employee fraud

c.Ghost employee fraud

d.Federal expense fraud

The number of exemptions claimed on a W-4 form helps to determine the federal income tax withholding.

True

False