Chapter.3 Exam Payroll Accounting
A child working for his father's corporation is not exempt from coverage under FICA. - correct answer
True
A worker hired by the federal government after 1983 is covered under FICA. - correct answer True
All employers of one or more persons must file an application for an identification number. - correct
answer True
Barr fails to make a timely deposit of FICA taxes and withheld income taxes until five days after the due
date. The penalty facing Barr is: - correct answer 2% of the undeposited taxes.
Each of the following items is accurately defined under FICA as taxable wages except: - correct answer
value of meals furnished employees for the employer's convenience.
Each year, the FICA (OASDI portion) taxable wage base is automatically adjusted whenever a cost of
living raise in social security benefits becomes available. - correct answer True
Employees and independent contractors pay different FICA tax rates. - correct answer True
Employers must withhold FICA taxes on payments that are made to independent contractors. - correct
answer False
If an employee, who works two or more separate jobs, pays OASDI taxes on wages in excess of the
taxable wage base, the employee is entitled to a refund of the overpayment. - correct answer True
If an employer fails to file an employment tax return on the due date, a penalty based on a certain
percentage of the amount of tax required to be reported may be added to the tax. - correct answer True
If on any day during a deposit period an employer has accumulated $100,000 or more in undeposited
employment taxes, the taxes must be deposited on the next banking day. - correct answer True
A child working for his father's corporation is not exempt from coverage under FICA. - correct answer
True
A worker hired by the federal government after 1983 is covered under FICA. - correct answer True
All employers of one or more persons must file an application for an identification number. - correct
answer True
Barr fails to make a timely deposit of FICA taxes and withheld income taxes until five days after the due
date. The penalty facing Barr is: - correct answer 2% of the undeposited taxes.
Each of the following items is accurately defined under FICA as taxable wages except: - correct answer
value of meals furnished employees for the employer's convenience.
Each year, the FICA (OASDI portion) taxable wage base is automatically adjusted whenever a cost of
living raise in social security benefits becomes available. - correct answer True
Employees and independent contractors pay different FICA tax rates. - correct answer True
Employers must withhold FICA taxes on payments that are made to independent contractors. - correct
answer False
If an employee, who works two or more separate jobs, pays OASDI taxes on wages in excess of the
taxable wage base, the employee is entitled to a refund of the overpayment. - correct answer True
If an employer fails to file an employment tax return on the due date, a penalty based on a certain
percentage of the amount of tax required to be reported may be added to the tax. - correct answer True
If on any day during a deposit period an employer has accumulated $100,000 or more in undeposited
employment taxes, the taxes must be deposited on the next banking day. - correct answer True
