quiz 4 Financial Accouting II

The taxes imposed under the Social Security Act consist of:A) two taxes on employers.

B) two taxes on employees.

C) OASDI and HI taxes.

D) taxes on the net earnings of the self-employed.

E) all of the above.

2.FICA defines all of the following as employees except:A) vice presidents.

B) partners.

C) superintendents.

D) full-time life insurance salespersons.

E) payroll managers.

3.FICA excludes from coverage all of the following kinds of employment except:A) domestic service performed in a college sorority by a student.

B) service performed by a 16-year-old child in the employ of the mother.

C) baby sitting service performed by a 35-year-old person who receives $40 in cash during the calendar quarter.

D) federal government secretaries hired in 1990.

E) services performed by a railroad worker for an employer covered by the Railroad Retirement Tax Act.

4.FICA defines all of the following as wages except:A) year-end bonuses.

B) standby payments.

C) total cash tips of $15 received by a tipped employee in May.

D) employees' social security taxes paid for by the employer.

E) first six months of sick pay.

5.Each of the following items is accurately defined under FICA as taxable wages except:A) value of meals furnished employees for the employer's convenience.

B) value of meals furnished employees for the employees' convenience.

C) commissions.

D) dismissal pay.

E) $500 award for productivity improvement suggestion.

6.Which of the following payments are not taxable for FICA?A) Back-pay awards.

B) Wage supplements to cover difference between employees salaries and their military pay.

C) Dismissal pay.

D) Difference between employees’ regular wages and the amount received for jury duty.

E) Retroactive wage increase.

7.The OASDI taxable wage base is correctly defined as:A) all amounts earned by an employee during a calendar year.

B) the maximum amount of wages during a calendar year that is subject to the OASDI tax.

C) all amounts paid an employee during a calendar year.

D) all amounts either earned by, or paid to, an employee during a calendar year.

E) none of the above.

8.Which of the following statements does not describe an employee's FICA taxes and withholdings?A) Employee's taxes are collected by the employer and paid to the IRS along with the employer's taxes.

B) Employee's taxes are deducted from the employee's wages at the time of payment.

C) Employee's liability for the FICA taxes continues even after the employer has withheld them.

D) Amount of tax to be withheld is computed by multiplying the employee's taxable wages by the current tax rate.

E) Employee is entitled to a refund for overpayment of FICA taxes resulting from having worked for more than one employer.

9.The FICA tax rates for the self-employeds are:A) 6.2% (OASDI) and 1.45% (HI).

B) 12.4% (OASDI) and 1.45% (HI).

C) 6.2% (OASDI) and 2.9% (HI).

D) 10.0% (OASDI) and 1.0% (HI).

E) none of the above.

10.Which of the following deposit requirements pertains to a monthly depositor who has accumulated employment taxes of $2,900 at the end of October?A) No deposit is required.

B) The undeposited taxes should be carried over to the end of November.

C) The taxes must be deposited on or before November 15.

D) The taxes must be deposited on or before the next banking day.

E) None of the above.

11.Which of the following deposit requirements pertains to a semiweekly depositor who has accumulated employment taxes of $17,500 on payday, Saturday, May 15?A) No deposit is required until May 17, the next banking day.

B) The undeposited taxes should be carried over to the next payday on May 22.

C) The taxes must be deposited on or before Tuesday, May 18.

D) The taxes must be deposited on or before Friday, May 21.

E) None of the above.

12.To be designated a semiweekly depositor, how much in employment taxes would an employer have reported for the four quarters in the lookback period?A) More than $50,000.

B) More than $100,000.

C) Less than $50,000.

D) More than $2,500.

E) None of the above.

13.Which of the following deposit requirements pertains to a nonagricultural employer who has employer FICA taxes and withheld employee FICA taxes and income taxes of $125,000 at the end of payday on Friday, August 15?A) No deposit is required until Tuesday, August 19.

B) The taxes must be deposited by the close of the next banking day.

C) The taxes must be deposited on or before August 31.

D) The undeposited taxes should be carried over to the end of September.

E) None of the above.

14.Ashe, an employer, has made timely deposits of FICA taxes and withheld income taxes during the third quarter. The last day of October is Sunday. The latest date on which Ashe may file Form 941 is:A) October 10.

B) October 31.

C) November 1.

D) November 10.

E) November 15.

15.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:A) 2% of the undeposited taxes.

B) 5% of the undeposited taxes.

C) 10% of the undeposited taxes.

D) 25% of the undeposited taxes.

E) none of the above.