Payroll MCQs / Payroll in Accounting MCQs
Which of the following is NOT a primary objective of payroll accounting?ù
a) Calculating employee wages and salaries
b) Complying with tax regulations
c) Monitoring employee attendance
d) Tracking employee benefits
Answer: c) Monitoring employee attendance
What is the purpose of a payroll register?
a) To record employee attendance
b) To calculate employee bonuses
c) To track employee benefits
d) To summarize payroll information
Answer: d) To summarize payroll information
Which of the following taxes is typically withheld from an employee’s paycheck?
a) Sales tax
b) Income tax
c) Property tax
d) Excise tax
Answer: b) Income tax
Which document is used to record an employee’s hours worked and wages earned?
a) W-2 form
b) Paycheck stub
c) Timesheet
d) Payroll journal
Answer: c) Timesheet
When should an employer issue a Form W-2 to an employee?
a) At the end of each pay period
b) At the end of the calendar year
c) When the employee requests it
d) When the employee leaves the company
Answer: b) At the end of the calendar year
Payroll MCQs / Payroll in Accounting MCQs
What is the purpose of Form 941 in payroll accounting?
a) Reporting federal income tax withheld from employee wages
b) Calculating employer’s quarterly payroll taxes
c) Recording employee hours and wages for each pay period
d) Reporting employee benefits and deductions
Answer: b) Calculating employer’s quarterly payroll taxes
Which of the following payroll taxes is solely the responsibility of the employer?
a) Social Security tax
b) Medicare tax
c) Federal income tax
d) State income tax
Answer: a) Social Security tax
Which of the following is an example of a payroll deduction?
a) Overtime pay
b) Annual bonus
c) Employee contributions to a retirement plan
d) Reimbursement for business expenses
Answer: c) Employee contributions to a retirement plan
What is the purpose of Form W-4 in payroll accounting?
a) Reporting employee wages and tips
b) Reporting employer’s quarterly payroll taxes
c) Calculating employee benefits and deductions
d) Determining the amount of federal income tax to withhold from employee wages
Answer: d) Determining the amount of federal income tax to withhold from employee wages
Payroll MCQs / Payroll in Accounting MCQs
What is the employer’s share of Social Security tax in the United States?
a) 6.2% of an employee’s wages
b) 1.45% of an employee’s wages
c) 12.4% of an employee’s wages
d) 2.9% of an employee’s wages
Answer: c) 12.4% of an employee’s wages
Which of the following is an example of a payroll accrual?
a) Employer’s share of Social Security tax
b) Employee’s federal income tax withholding
c) Employee’s retirement plan contribution
d) Employer’s contribution to employee health insurance
Answer: d) Employer’s contribution to employee health insurance
Which payroll tax is typically shared between the employer and the employee?
a) Medicare tax
b) State income tax
c) Federal unemployment tax
d) Local payroll tax
Answer: a) Medicare tax
What is the purpose of a payroll reconciliation?
a) To calculate employee bonuses
b) To verify the accuracy of payroll records
c) To track employee attendance
d) To determine employee raises
Answer: b) To verify the accuracy of payroll records
Which form should an employer file to report wages paid to employees?
a) Form 1099
b) Form W-2
c) Form W-4
d) Form 941
Answer: b) Form W-2
Payroll MCQs / Payroll in Accounting MCQs
What is the primary purpose of a pay period?
a) To determine employee benefits
b) To calculate employee raises
c) To record employee attendance
d) To establish the timeframe for paying employee wages
Answer: d) To establish the timeframe for paying employee wages
Which of the following is an example of a mandatory payroll deduction?
a) Employee’s charitable donation
b) Employee’s union dues
c) Employee’s gym membership fee
d) Employee’s vacation pay
Answer: b) Employee’s union dues
What is the purpose of Form 940 in payroll accounting?
a) Reporting federal income tax withheld from employee wages
b) Calculating employer’s quarterly payroll taxes
c) Reporting employee benefits and deductions
d) Filing the employer’s annual federal unemployment tax return
Answer: d) Filing the employer’s annual federal unemployment tax return
Which federal agency is responsible for overseeing payroll tax compliance in the United States?
a) Internal Revenue Service (IRS)
b) Social Security Administration (SSA)
c) Department of Labor (DOL)
d) Occupational Safety and Health Administration (OSHA)
Answer: a) Internal Revenue Service (IRS)
Payroll MCQs / Payroll in Accounting MCQs
What is the purpose of a payroll journal?
a) To record employee raises
b) To track employee attendance
c) To summarize payroll information
d) To calculate employee bonuses
Answer: c) To summarize payroll information
Which of the following is an example of a voluntary payroll deduction?
a) Employee’s federal income tax withholding
b) Employee’s Social Security tax
c) Employee’s state income tax withholding
d) Employee’s health insurance premium
Answer: d) Employee’s health insurance premium
What is the purpose of a pay stub?
a) To record employee attendance
b) To calculate employee raises
c) To provide a detailed breakdown of employee wages and deductions
d) To track employee benefits
Answer: c) To provide a detailed breakdown of employee wages and deductions
Which of the following is an example of a payroll liability?
a) Employee’s overtime pay
b) Employee’s commission earnings
c) Employer’s contribution to a retirement plan
d) Employer’s payroll taxes payable
Answer: d) Employer’s payroll taxes payable
Payroll MCQs / Payroll in Accounting MCQs
Which federal law establishes the minimum wage in the United States?
a) Fair Labor Standards Act (FLSA)
b) Americans with Disabilities Act (ADA)
c) Occupational Safety and Health Act (OSHA)
d) Family and Medical Leave Act (FMLA)
Answer: a) Fair Labor Standards Act (FLSA)
What is the purpose of a direct deposit authorization form?
a) To calculate employee bonuses
b) To track employee attendance
c) To authorize the employer to deposit wages directly into an employee’s bank account
d) To report employee wages to the government
Answer: c) To authorize the employer to deposit wages directly into an employee’s bank account
Which of the following is an example of a fringe benefit?
a) Paid vacation time
b) Overtime pay
c) Performance bonus
d) Social Security tax
Answer: a) Paid vacation time
What is the purpose of a Form 1099-MISC in payroll accounting?
a) Reporting employee wages and tips
b) Reporting contractor payments
c) Calculating employee benefits and deductions
d) Determining the amount of federal income tax to withhold from employee wages
Answer: b) Reporting contractor payments
Payroll MCQs / Payroll in Accounting MCQs
Which of the following is an example of an employer’s payroll expense?
a) Employee’s federal income tax withholding
b) Employee’s retirement plan contribution
c) Employee’s overtime pay
d) Employee’s union dues
Answer: c) Employee’s overtime pay
What is the purpose of a payroll audit?
a) To calculate employee raises
b) To verify the accuracy and compliance of payroll records
c) To track employee attendance
d) To determine employee benefits
Answer: b) To verify the accuracy and compliance of payroll records
Which payroll tax is used to fund unemployment benefits for eligible workers?
a) Social Security tax
b) Medicare tax
c) Federal income tax
d) Federal unemployment tax
Answer: d) Federal unemployment tax
What is the purpose of a Form W-3 in payroll accounting?
a) Reporting employee wages and tips
b) Reporting employer’s quarterly payroll taxes
c) Summarizing employee tax withholdings for the year
d) Determining the amount of Social Security tax to withhold from employee wages
Answer: c) Summarizing employee tax withholdings for the year