Accounting Chapter 12 : Payroll Accounting
1.45% - correct answer Medicare Tax
401(k) plan - correct answer a type of account that allows employees to defer paying
taxes until retirement
6.2% - correct answer Social Security Tax
accumulated earnings - correct answer the employee's year-to-date gross earnings
allowance - correct answer reduces the amount of income tax to be withheld
comission - correct answer an amount paid to an employee based on a percentage of
the employee's sales
deduction - correct answer an amount that is subtracted from gross earnings
direct deposit - correct answer the net pay is deposited in the employee's personal bank
account by the employer
electronic badge readers - correct answer computer technology to track an employee
arrival and departure times
employee's earnings record - correct answer record that contains all of the payroll
information related to an employee
False - correct answer An employee's gross earnings may be calculated by any of the
four methods- salary, piece rate, hourly wage, or commission- but never by a
combination of these methods.
False - correct answer Employee's earnings records are kept on a monthly basis to
make it easier to complete government reports that are required.
False - correct answer Employees paid by direct deposit have their gross pay
electronically deposited in their personal bank accounts.
False - correct answer Overtime is paid to most employees after 44 hours of work in a
pay week.
False - correct answer Payroll is not a major expense of most businesses.
False - correct answer The amount of taxes withheld from each employee's paycheck is
the exact amount that the employee will owe at the end of the tax year.
1.45% - correct answer Medicare Tax
401(k) plan - correct answer a type of account that allows employees to defer paying
taxes until retirement
6.2% - correct answer Social Security Tax
accumulated earnings - correct answer the employee's year-to-date gross earnings
allowance - correct answer reduces the amount of income tax to be withheld
comission - correct answer an amount paid to an employee based on a percentage of
the employee's sales
deduction - correct answer an amount that is subtracted from gross earnings
direct deposit - correct answer the net pay is deposited in the employee's personal bank
account by the employer
electronic badge readers - correct answer computer technology to track an employee
arrival and departure times
employee's earnings record - correct answer record that contains all of the payroll
information related to an employee
False - correct answer An employee's gross earnings may be calculated by any of the
four methods- salary, piece rate, hourly wage, or commission- but never by a
combination of these methods.
False - correct answer Employee's earnings records are kept on a monthly basis to
make it easier to complete government reports that are required.
False - correct answer Employees paid by direct deposit have their gross pay
electronically deposited in their personal bank accounts.
False - correct answer Overtime is paid to most employees after 44 hours of work in a
pay week.
False - correct answer Payroll is not a major expense of most businesses.
False - correct answer The amount of taxes withheld from each employee's paycheck is
the exact amount that the employee will owe at the end of the tax year.
