Question 1

The employer usually pays the entire cost of

Accepted Answer

A)   FICA.
B)   Workers' Compensation Insurance.
C)   Medical Insurance.
D)   Disability Insurance.

Question 2

Employer payroll taxes clearly are a significant cost of doing business.

Accepted Answer

A) True 
 B)False

Question 3

An Employer Identification Number (EIN)  is obtained by the employer from the

Accepted Answer

A)   nearest Federal Reserve Bank.
B)   CIA.
C)   Internal Revenue Service.
D)   nearest local federally insured bank.

Question 4

Match the terms with the definitions.
-A contribution to the FICA program.

Accepted Answer

A)  Electronic Federal Tax Payment System (EFTPS) 
B)  employer FICA taxes
C)  Employer Identification Number (EIN) 
D)  Form W-2
E)  Form W-3F) Form 940G) Form 941H) FUTA (Federal Unemployment Tax Act)  taxI) merit-rating systemJ) self-employment incomeK) self-employment taxL) SUTA (state unemployment tax)  taxM) workers' compensation insurance

Question 5

Self-employment tax is a contribution to the unemployment compensation program.

Accepted Answer

A) True 
 B)False  False

Question 6

The total payroll cost to an employer of an employee who has gross earnings of $78,000 is

Accepted Answer

A)   $78,000 plus 30 percent.
B)   less than $78,000.
C)   exactly $78,000.
D)   more than $78,000.

Question 7

In most states, the state unemployment tax is levied only on employers.

Accepted Answer

A) True 
 B)False

Question 8

The amount of employers' Medicare taxes is computed by multiplying total earnings by 1.45%.

Accepted Answer

A) True 
 B)False

Question 9

After estimating its payroll for the year, an employer usually pays workers' compensation insurance

Accepted Answer

A)   at the beginning of the year.
B)   monthly.
C)   quarterly.
D)   at the end of the year.

Question 10

When all taxes have been paid, the Social Security Tax Payable account will have

Accepted Answer

A)   a debit balance.
B)   a credit balance.
C)   a zero balance.
D)   equal debit and credit balances.

Question 11

In general, the larger the amount of Social Security and Medicare taxes due from an employer, the more frequently payments must be made.

Accepted Answer

A) True 
 B)False

Question 12

The adjustment to journalize an additional premium due at the end of the year for workers' compensation insurance (WCI)  is

Accepted Answer

A)   debit WCI Expense and credit Cash.
B)   debit WCI Expense and credit Insurance Refund.
C)   debit WCI Expense and credit WCI Payable.
D)   debit Insurance Payable and credit WCI Payable.

Question 13

To journalize the payment of Social Security taxes to the IRS, the correct entry would be

Accepted Answer

A)   debit Social Security Tax Payable and credit IRS.
B)   debit Social Security Tax Payable and credit Social Security Payable.
C)   debit Social Security Tax Payable and credit Cash.
D)   debit Social Security Tax Payable and credit Payroll Taxes Expense. C

Question 14

Self-employed individuals can be viewed as both employer and employee.

Accepted Answer

A) True 
 B)False

Question 15

The cost of workers' compensation insurance for the employer depends on all of the following EXCEPT

Accepted Answer

A)   the number of employees.
B)   the riskiness of the jobs the employees perform.
C)   the company's accident history.
D)   the amount of FICA, FUTA, and SUTA taxes due.

Question 16

One-half of the self-employment tax is really a personal expense to the owner of the business.

Accepted Answer

A) True 
 B)False

Question 17

The date on which an employer must pay Social Security and Medicare taxes is

Accepted Answer

A)   January 1 of each year.
B)   December 31 of each year.
C)   June 30 of each year.
D)   dependent on the amount of the taxes.

Question 18

The cost of workers' compensation insurance to a construction company with 500 employees would be higher than the cost of insurance to a small candy company with only five employees.

Accepted Answer

A) True 
 B)False

Question 19

To journalize the employer's payroll taxes, we need to credit all of the following accounts EXCEPT

Accepted Answer

A)   Payroll Taxes Expense.
B)   Social Security Tax Payable.
C)   Medicare Tax Payable.
D)   FUTA Tax Payable. A

Question 20

FUTA taxes are deposited and an annual report of federal unemployment tax is filed using Form 8109.

Accepted Answer

A) True 
 B)False

Exam 9: Payroll Accounting: Employer Taxes and Reports

The employer usually pays the entire cost of

Correct AnswerverifiedShow Answer

Employer payroll taxes clearly are a significant cost of doing business.

Correct AnswerverifiedShow Answer

An Employer Identification Number (EIN) is obtained by the employer from the

Correct AnswerverifiedShow Answer

Match the terms with the definitions. -A contribution to the FICA program.

Correct AnswerverifiedShow Answer

Self-employment tax is a contribution to the unemployment compensation program.

Correct AnswerverifiedFalse

The total payroll cost to an employer of an employee who has gross earnings of $78,000 is

Correct AnswerverifiedShow Answer

In most states, the state unemployment tax is levied only on employers.

Correct AnswerverifiedShow Answer

The amount of employers' Medicare taxes is computed by multiplying total earnings by 1.45%.

Correct AnswerverifiedShow Answer

After estimating its payroll for the year, an employer usually pays workers' compensation insurance

Correct AnswerverifiedShow Answer

When all taxes have been paid, the Social Security Tax Payable account will have

Correct AnswerverifiedShow Answer

In general, the larger the amount of Social Security and Medicare taxes due from an employer, the more frequently payments must be made.

Correct AnswerverifiedShow Answer

The adjustment to journalize an additional premium due at the end of the year for workers' compensation insurance (WCI) is

Correct AnswerverifiedShow Answer

To journalize the payment of Social Security taxes to the IRS, the correct entry would be

Correct AnswerverifiedC

Self-employed individuals can be viewed as both employer and employee.

Correct AnswerverifiedShow Answer

The cost of workers' compensation insurance for the employer depends on all of the following EXCEPT

Correct AnswerverifiedShow Answer

One-half of the self-employment tax is really a personal expense to the owner of the business.

Correct AnswerverifiedShow Answer

The date on which an employer must pay Social Security and Medicare taxes is

Correct AnswerverifiedShow Answer

The cost of workers' compensation insurance to a construction company with 500 employees would be higher than the cost of insurance to a small candy company with only five employees.

Correct AnswerverifiedShow Answer

To journalize the employer's payroll taxes, we need to credit all of the following accounts EXCEPT

Correct AnswerverifiedA

FUTA taxes are deposited and an annual report of federal unemployment tax is filed using Form 8109.

Correct AnswerverifiedShow Answer

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False

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C

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