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Exam 10: Payroll Computations, Records, and Payment

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Question 41

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If an employee whose regular hourly rate is $9 and whose overtime rate is 1.5 times the regular rate works 42 hours in one week, the employee's gross pay is $567.

A) True
B) False

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Question 42

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Employees of firms engaged in interstate commerce must receive an overtime rate of at least 1.5 times the regular hourly rate of pay for time worked in excess of ________ hours per week.

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Question 43

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Publication 15, Circular E contains federal income tax withholding tables.

The monthly salaries for December and the year-to-date earnings as of November 30 for the three employees of the Barbara's Bookstore, Inc. are listed below. Compute the amount of social security tax and Medicare tax to be withheld from each of the employee's gross pay for December. Assume a 6.2 percent social security tax rate on a maximum of $122,700 for the calendar year. Assume a 1.45 percent Medicare tax rate.

ABC Grocers uses a separate checking account to pay their employees. The gross pay for the period was $850. However, after deductions were taken out, the net pay for the period was $790. The journal entry to record the issuance of payroll checks to their employees would include:

The amount debited to Wages Expense when a payroll is recorded is the

If an employee works for more than one employer during the year, the social security tax is deducted and matched by only one employer.

The Burns Company has two office employees and two shipping employees. A summary of their earnings and deductions for the week ended August 23, 2019, is shown below. On page 10 of a general journal, record the August 23 payroll and the entry to summarize the effect of the checks written to pay the payroll.

An employee whose regular hourly rate is $12 and whose overtime rate is 1.5 times the regular rate worked 48 hours in one week. The total overtime earned by the employee for the week is

Which of the following is a factor in the determination of the amount of social security tax to withhold from an employee's pay?

The Royal Company has office employees and sales employees. A summary of their earnings and deductions for the week ended April 26, 2019, is shown below. On page 18 of a general journal, record the April 26 payroll and the entry to summarize the effect of the checks written to pay the payroll.

Lila Harrison's is the sole employee of ABC Grocers. Her gross pay for the week was $400. She had deductions of $50 for federal income tax, $24.80 for social security tax, and $5.80 for Medicare tax. The journal entry to record her gross pay would include:

An employee whose regular hourly rate is $10 and whose overtime rate is 1.5 times the regular rate worked 44 hours in one week. In the payroll register, the employer should record wages expense of

Match the description with the accounting terms.

Abe Carter had gross earnings of $6,000 for the pay period ending 11/30. His total gross earnings as of 11/15 were $116,000. If Social Security taxes are 6.2% on a maximum earnings of $122,700 per year and Medicare tax is 1.45% on all earnings, the journal entry to record his earnings for the period ending 11/30 would include:

Salespeople who are paid a percentage of net sales are paid on a(n)

Sabrina Duncan had gross earnings for the pay period ending 10/15/19 of $5,785. Her total gross earnings as of 9/30/19 were $116,400. If Social Security taxes are 6.2% on a maximum earnings of $122,700 per year, Sabrina's Social Security withheld from her 10/15/19 paycheck would be:

Rick O'Shea, the only employee of Hunter Furniture Company, makes $30,000 per year and is paid once a month. For the month of July, his federal income taxes withheld are $180, state income taxes withheld are $37, social security tax is 6.2%, Medicare tax is 1.45%, State Unemployment Tax is 4%, and Federal Unemployment tax is 0.6%. What is Rick's net pay for July?

During one week, three employees of the Siesta Inn worked the number of hours shown below. All these employees receive overtime pay at one and a half times their regular hourly rate for any hours worked beyond 40 in a week. Compute the regular earnings, overtime earnings, and gross pay for each employee. $\begin{array}{|c|r|l|l|l|l|}\hline \begin{array}{l}\text { Employee } \\\text { No. }\end{array} & \begin{array}{l}\text { Regular } \\\text { Hourly Rate }\end{array} & \begin{array}{l}\text { Hours } \\\text { Worked }\end{array} & \begin{array}{l}\text { Regular } \\\text { Earnings }\end{array} & \begin{array}{l}\text { Overtime } \\\text { Earnings }\end{array} & \text { Gross Pay } \\\hline 1 & \$ 14.00 & 46 & & & \\\hline 2 & 12.00 & 44 & & & \\\hline 3 & 10.00 & 45 & & & \\\hline\end{array}$

It is best not to pay wages and salaries by