36) When using a payroll register, Salaries and Wages Expense equals the current period earnings of
employees.
37) The current period earnings column of the payroll register only includes regular and overtime
earnings.
38) A ________ is a schedule that summarizes the earnings, withholdings, and net pay for each employee.
A) payroll register
B) bin card
C) cash ledger
D) bank reconciliation statement
39) Which of the following columns is typically included in a payroll register?
A) Direct Labor Hours Worked
B) Warranties Payable
C) Current Period Earnings
D) Sales Tax
40) Dallas Corp. has gross pay for March of $50,000. The journal entry to record salaries expense would
include a debit to Salaries and Wages Payable for $50,000.
41) Ron is an employee of Panache, Inc. Panache pays a portion of his health insurance premium and also
contributes to a retirement plan in his name. The company’s share of the health insurance premium is
$600, and the company‘s contribution to the retirement plan is $860. The journal entry to record the
employee benefits to be paid by the company should include a debit to Employee Health Insurance
Payable for $1,460.
42) Angie Pereira and Ferro Schwartz are employees of Free Star, Inc. In February 2019, Angie’s gross pay
was $6000, and Ferro’s gross pay was $7400. All earnings are subject to FICA—OASDI Tax of 6.2% and
FICA—Medicare Tax of 1.45%. Which of the following would be included in the entry to record the
salaries expense for February?
A) a debit to Salaries Payable to employees for $830.80
B) a debit to FICA—Medicare Taxes Payable for $830.80
C) a credit to FICA—OASDI Taxes Payable for $830.80
D) a credit to Salaries Expense for $830.80
43) For the month of September, Seawide Sales, Inc. recorded gross pay of $74,500. The net pay for the
month amounted to $59,500. The salaries are paid on October 5. Which of the following is the journal
entry for the payment of salaries?
A)
Salaries and Wages Payable
59,500
Cash
59,500
B)
Salaries and Wages Payable
74,500
Cash
74,500
C)
Salaries and Wages Expense
59,500
Cash
59,500
D)
Cash
74,500
Salaries and Wages Expense
74,500
44) Mountain Valley Sales, Inc. has gross pay for March of $45,000. Which of the following is included in
the journal entry to record salaries expense?
A) credit Salaries and Wages Expense
B) debit Cash
C) debit Salaries and Wages Payable
D) debit Salaries and Wages Expense
45) Keith, an employee of Sunbeam, Inc., has gross salary for May of $15,000. The entire amount is under
the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal income tax at a rate of
20%. Which of the following is a part of the journal entry to record the disbursement of his net pay?
(Assume a FICA—OASDI Tax of 6.2% and FICA—Medicare Tax of 1.45%.) (Round the final answer to the
nearest dollar.)
A) debit to Cash for $10,852.50
B) credit to Cash for $10,852.50
C) debit to Employee Income Tax Payable of $10,852.50
D) debit to FICA Tax Payable of $10,852.50
46) Randall, an employee of Ramsay’s, Inc., has gross salary for March of $4,000. The entire amount is
under the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal income tax at a
rate of 18%. Randall has a deduction of $320 for health insurance and $80 for United Way. Which of the
following is included in the entry to record the liabilities for payroll withholding deductions
A) debit to Salaries Payable
B) credit to United Way Payable
C) debit to FICA Taxes Payable
D) debit to Cash
47) Harrison, an employee of Safe Associates, Inc., has gross salary for March of $4,000. The entire
amount is under the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal
income tax at a rate of 18%. Harrison has a deduction of $320 for health insurance and $80 for United
Way. Which of the following is included in the entry to record the disbursement of his net pay?
A) credit to Salaries and Wages Payable
B) debit to United Way Payable
C) debit to FICA Taxes Payable
D) credit to Cash
48) Preston Sales, Inc. has gross salaries and wages for March of $45,000. Provide the journal entry to
record salaries and wages expense and payroll withholdings. (Assume a FICA—OASDI Tax of 6.2% and
FICA—Medicare Tax of 1.45%.) Salaries and wages to date are under the OASDI limit. Assume no federal
or state income taxes are due. Salaries and wages will be paid at a later date. Omit explanation.
49) Lawrence, an employee of Triple Time, Inc., has gross salary for March of $4,000. The entire amount is
under the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal income tax at a
rate of 18%. Provide the journal entry to record salaries expense and payroll withholdings. (Assume a
FICA—OASDI Tax of 6.2% and FICA—Medicare Tax of 1.45%.) Salaries will be paid at a later date. Omit
explanation.
50) John, an employee of Smith Electric, Inc., has gross salary for March of $4,000. The entire amount is
under the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal income tax at a
rate of 18%. John has a deduction of $320 for health insurance and $80 for United Way. Provide the
journal entry to record salaries expense and payroll withholdings. (Assume a FICA—OASDI Tax of 6.2%
and FICA—Medicare Tax of 1.45%.) Salaries will be paid at a later date. Omit explanation.
51) Josh Baker works for Jones Restaurant Supply all year and earns a monthly salary of $8,000. There is
no overtime pay and Jones withholds income taxes at 12% of gross pay. Jones deducts $200 monthly for
the co-payment of the health insurance premium. Employees are paid on the fifth day of each month. As
of October, 31, Josh had $80,000 of cumulative earnings. Journalize the accrual of salaries expense on
October 31. Omit explanations.
52) Federal unemployment compensation tax (FUTA) is not withheld from employees‘ gross earnings.
53) State unemployment compensation tax (SUTA) is not withheld from employees’ gross earnings.
54) State unemployment compensation tax (SUTA) is paid by the employer and is not deducted from an
employee‘s gross earnings.
55) Federal unemployment compensation tax is paid by the employer and is not deducted from an
employee‘s gross earnings.
56) FICA tax is paid by the employee only and is deducted from gross earnings.
57) The Social Security system is funded by contributions from both the employer and employee.
58) Employer FICA is paid by the employer and recorded as a payroll tax expense.
59) FICA tax is a tax that is paid both by the employer and the employee.
60) Employer FICA tax is paid by the employer and is added to the employee’s earnings.
61) FICA tax is paid by the employee only.
62) David, an employee of Cecil, Inc., has gross salary for March of $5,900. The entire amount is under the
OASDI limit of $118,500, and thus subject to FICA. He is also subject to federal income tax at a rate of
30%. His year-to–date pay has already exceeded the $7,000 cap for FUTA and SUTA. The journal entry to
record the employer’s payroll tax expense includes a credit to FICA–OASDI Taxes Payable for $365.80.
(Assume a FICA–OASDI Tax of 6.2% and FICA–Medicare Tax of 1.45%.)
63) Joel, an employee of Cruise Travel, Inc., has gross salary for March of $5,200. The entire amount is
under the OASDI limit of $118,500, and thus subject to FICA. He is also subject to federal income tax at a
rate of 29%. His year–to-date pay has already exceeded the $7,000 cap for FUTA and SUTA. The journal
entry to record employer‘s payroll tax expense includes a credit to FICA–Medicare Taxes Payable for
$150.80. (Assume a FICA–OASDI Tax of 6.2% and FICA–Medicare Tax of 1.45%.)
64) The journal entry to record the employer’s payroll tax expense will include a debit to Employee
Income Taxes Payable.
65) Maywood, Inc. withholds $720 from Steve‘s paycheck for federal income tax. This amount is part of
the company’s payroll tax expense.
66) Which of the following is paid by the employer only?
A) OASDI tax
B) Medicare tax
C) employee income tax
D) federal unemployment tax
67) It is mandatory for both the employer and employee to pay ________.
A) FICA
B) SUTA
C) employee income tax
D) federal unemployment tax
68) Which of the following deductions is paid by both the employer and employee?
A) federal income taxes
B) federal unemployment taxes
C) FICA taxes
D) SUTA taxes
69) Stone’s gross pay for the week is $1600. Stone’s year–to-date pay is under the limit for OASDI. Assume
that the rate for state and federal unemployment compensation taxes is 6% and that Stone’s year–to-date
pay has not yet exceeded the $7000 cap. What is the amount of state and federal unemployment tax that
his employer must record as payroll tax expense and pay to the federal and state governments?
A) $225.84
B) $215.20
C) $119.20
D) $96.00