Review for TSA (Accounting) chapters 12 13 23 25 26

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NickCunningham
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271448
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Review for TSA (Accounting) chapters 12 13 23 25 26
Updated:
2014-04-22 09:51:43
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Accounting TSA NorthTech HighSchool
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Accounting TSA review
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  1. True or False: when a business records its payroll, the amount of federal income tax withheld from employees is entered as a liability
    True

  2. True or False: the amounts for FICA taxes withheld depends on an empolyees's gross earnings, marital status and number of withholding allowances
    False 
  3. True or False : once an employee's year to date earnings reach a certain amount set by law, Social Security taxes are no longer withheld
    True 
  4. The column totals in a payroll register are
    A) used in the journal entry to record the payroll
    B) posted directly to the general ledger accounts
    C) transferred to the employees' earnings record 
    D) Subject to federal taxes
    A) used in the journal entry to record the payroll

  5. The social security tax
    A) is levied only on employers 
    B) is subject to change by Congress 
    C) has no maximum taxable amount 
    D) is a voluntary deduction
    • B) Subject to change by Congress
    •  
  6. Federal income taxes are
    A) withheld from employee earnings at the end of each payroll period 
    B) paid by the employer only 
    C) withheld from employee earnings and levied on the employer also
    D) withheld from employee earnings at the end of each quarter
    A) withheld from employee earnings at the end of each payroll period
  7. The entry to record the payroll requires 
    A) a debit to Salaries Expense and various liability accounts and a credit to cash in bank
    B) a debit to salaries expense a credit to various liability accounts and a credit to cash in bank 
    C) a debit to salaries payroll tax expense a credit to various liability accounts and a credit to cash in bank
    D) a debit to salaries payable a debit to medicare tax payable a debit to social security tax payable and a credit to cash in bank
    B) a debit to salaries expense a credit to various liability accounts and a credit to cash in bank 

  8. What is Federal income tax ?
    A tax levied by the United States Internal Revenue Service (IRS) on the annual earnings of individuals, corporations, trusts and other legal entities. Federal income taxes are applied on all forms of earnings that make up a taxpayer's taxable income, such as employment earnings or capital gains.
  9. What is social security tax?
    The tax levied on both employers and employees used to fund the Social Security program. Social Security tax is usually collected in the form of payroll tax or self-employment tax. The Social Security tax pays for the retirement and disability benefits received by millions of Americans each year.
  10. What is FICA ?
    A U.S. law requiring a deduction from paychecks and income that goes toward the Social Security program and Medicare. Both employees and employers are responsible for sharing the FICA payments.
  11. Explain voluntary deductions
    Voluntary deductions include union dues, health insurance payments, life insurance payments,pension and other retirement contributions, credit union deposits and payments, U.S. saving bonds, and charitable contributions
  12. What is a 401(k) plan?
    A 401(k) is a retirement savings plan sponsored by an employer. It lets workers save and invest a piece of their paycheck before taxes are taken out. Taxes aren’t paid until the money is withdrawn from the account.
  13. How do you calculate interest on a note payable or note receivable?
    Interest = principal x interest rate x time 

    I = P X R X T
  14. What is a promissory note?
    is a written promise to pay a certain amount of money at a specific time
  15. Note payable
    is a promissory note that a business issues to a creditor when it borrows or buys on credit.
  16. Note receivable
    is a promissory note that a business accepts from a credit customer
  17. Principal or face value
    amount being borrowed
  18. Payee
    person or business to which payment will be made
  19. Maturity date
    due date of the note
  20. Maker
    the person or business promising to repay the principal and interest
  21. Maturity value
    is the amount due at the due date
  22. What are the steps to find the maturity date of a promissory note ?
    • 1. find the number of days remaining in the month 
    • 2. subtract the number found in step 1 from the term of the note
    • 3. subtract the number of days in the next month from the number of days remaining 
    • 4. Subtract the number of days in the next month from the days remaining

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