What is FICA? correct answers-Federal Insurance Contributions Act
-Made up of social security and medicare
-levies taxes on all employees (even self-employed)
2020 Social Security Tax Rate correct answers6.2% of the first $137,700 in wages. Both employee and employer is 6.2%. Not subject to so...
What is FICA? correct answers-Federal Insurance Contributions Act
-Made up of social security and medicare
-levies taxes on all employees (even self-employed)
2020 Social Security Tax Rate correct answers6.2% of the first $137,700 in wages. Both employee and
employer is 6.2%. Not subject to social security taxes if wages exceed this amount.
This amount is DOUBLED for those who are self employed, 12.4%
Medicare tax rate correct answers1.45% no cap (no wage limit on this tax)
2.9% for those who are self employeed
The combined rate for the Social Security tax and the Medicare tax to be withheld from each employee's
gross wages up to $137,700 in 2020 is correct answers7.65%
The amount of FICA that should be withheld from an employee's salary of $150,000 in the year 2020 is
correct answers$10,712.40
Social Security tax of $8,537.40 (6.2% X $137,700)
PLUS
Medicare tax of $2,175 (1.45% X $150,000)
The pay earned by hourly-paid employees is usually referred to as correct answerswages
The pay earned by managers who are paid semi-monthly is referred to as correct answerssalary/salaries
Which employee payroll classification will likely require an accrual adjusting entry for the gross salaries
or wages at the end of a calendar month? correct answershourly employees paid weekly
, - because they have their paydays approximately one week after their workweeks and generally the
workweek does not end on the last calendar day of the month.
The federal form on which an employee indicates the number of allowances to be used by the employer
when calculating the federal income tax withholding is the correct answersW-4 Form
An example of a court-ordered employee withholding is correct answersgarnishment or child support
Garnishment correct answersA court ruling that requires that money be deducted from a person's
paycheck involuntarily in order to pay a debt.
The amount that an employee "clears" or "takes home" is the correct answersNET pay
Income BEFORE taxes and deductions are taken correct answersGROSS pay
Amount of income left after taxes and deductions have been taken out. correct answersNet Pay (take
home pay)
A tax paid by the employer that is 0.6% of each employee's first $7,000 of annual salary or wages is
correct answersfederal unemployment tax
A cost paid by the employer to cover an employee's work-related injury is correct answersworkers
compensation insurance
Where does workers comp get reported on the financial statements? correct answersThe income
statement and the balance sheet
time-and-a-half pay correct answersHourly pay rate x 1.5
double pay rate correct answersdouble the hourly pay rate
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