Payroll Accounting 2019 5th Edition Landin Test Bank

Payroll Accounting 2019 5th Edition
Landin Test Bank

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Payroll Accounting 2019, 5e (Landin)
Chapter 5 Employee Net Pay and Pay Methods
1) Computation of net pay involves deducting mandatory and voluntary deductions from gross
pay.
Answer: TRUE
Difficulty: 1 Easy
Topic: Compute Employee Net Pay
Learning Objective: 05-01 Compute Employee Net Pay
Bloom's: Understand
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
2) Federal income tax, Medicare tax, and Social Security tax amounts withheld from employee
pay are computed based on gross pay, less pre-tax deductions, and deducted to arrive at net pay.
Answer: TRUE
Difficulty: 1 Easy
Bloom's: Understand
3) The amount of federal income tax withheld decreases as the number of allowances increases.
Answer: TRUE
Difficulty: 1 Easy
Topic: Determine Federal Income Tax Withholding Amounts
Learning Objective: 05-02 Determine Federal Income Tax Withholding Amounts
Bloom's: Understand
4) The wage-bracket of determining federal tax withholding yields more accurate amounts than
the percentage method.
Answer: FALSE
Explanation: The percentage method yields more accurate results because the wage-bracket
tables are rounded to the dollar.
Difficulty: 1 Easy
Bloom's: Understand
1
Copyright © 2019 McGraw-Hill Education. All rights reserved.
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
5) Social Security tax has a wage base, which is the minimum amount an employee must earn
before they will have the Social Security tax deduction.
Answer: FALSE
Explanation: The Social Security tax wage base is the maximum salary amount for which the
tax may be deducted.
Difficulty: 1 Easy
Topic: Compute Social Security and Medicare Tax Withholding
Learning Objective: 05-03 Compute Social Security and Medicare Tax Withholding
Bloom's: Understand
6) The regular Medicare tax deduction is 1.45% for employee and employer and must be paid by
all employees.
Answer: TRUE
Difficulty: 1 Easy
Bloom's: Understand
7) A firm has headquarters in Indiana, but has offices in California and Utah. For employee
taxation purposes, it may choose which of those three states income tax laws it wishes to use.
Answer: FALSE
Explanation: The employer must pay employee taxes based on each employee's permanent
residence.
Difficulty: 2 Medium
Topic: Calculate State and Local Income Taxes
Learning Objective: 05-04 Calculate State and Local Income Taxes
Bloom's: Analyze
AACSB: Communication
2
8) Garnishments are court-ordered amounts that an employer must withhold from an employee's
pre-tax pay and remit to the appropriate authority.
Answer: FALSE
Explanation: Garnishments are post-tax deductions.
Topic: Apply Post-Tax Deductions
Learning Objective: 05-05 Apply Post-Tax Deductions
Bloom's: Analyze
9) Charitable contributions are an example of post-tax voluntary deductions.
Answer: TRUE
Difficulty: 1 Easy
Bloom's: Understand
10) The use of paycards as a means of transmitting employee pay began in the 1990s with over-
the-road drivers out of a need to transmit funds reliably on payday.
Answer: TRUE
Difficulty: 1 Easy
Topic: Discuss Employee Pay Methods
Learning Objective: 05-06 Discuss Employee Pay Methods
Bloom's: Understand
11) Which are steps in the net pay computation process? (You may select more than one
answer.)
A. Update employee records.
B. Report fringe benefit balances.
C. Compute gross pay.
D. Compute taxes to be withheld.
Answer: C, D
Difficulty: 1 Easy
Bloom's: Understand
3
12) What payroll-specific tool is used to facilitate computation of net pay?
A) Employee Information Form
B) Payroll Register
C) Form I-9
D) Supervisor Payroll Report
Answer: B
Difficulty: 1 Easy
Bloom's: Understand
AACSB: Communication
13) How are income taxes and FICA taxes applied to grossed-up pay? (You may select more
than one answer.)
A. Subtract the sum of the income tax rate and FICA tax rate from 100 percent.
B. Compute the sum of the income tax and FICA tax rates.
C. Divide the net pay by the net tax rate.
D. Multiply the gross pay by the sum of the income tax and FICA tax rates.
Answer: A, B, C
Difficulty: 1 Easy
Bloom's: Understand
AACSB: Analytical Thinking
14) Which of the following federal withholding allowance scenarios will have the highest
income tax?
A) Single, 1 allowance
B) Married, 3 allowances
C) Single, 5 allowances
D) Married, 0 allowances
Answer: A
Difficulty: 1 Easy
Bloom's: Understand
4
15) Which of the following statements is/are true about Social Security tax deductions from
gross pay? (You may select more than one answer.)
A. Section 125 deductions are not subject to Social Security tax.
B. The tax rate is 6.0%.
C. The tax is computed on all earnings.
D. The wage base is $128,400.
Answer: A, D
Difficulty: 1 Easy
Bloom's: Understand
16) Which of the following statements is/are true about Medicare tax? (You may select more
than one answer.)
A. All employee earnings less pre-tax deductions are subject to Medicare tax.
B. Employers match all Medicare taxes withheld.
C. The Medicare tax rate is 1.45%.
D. Additional Medicare tax is withheld for employees who earn more than $150,000 annually.
Answer: A, C
Difficulty: 1 Easy
Bloom's: Understand
17) Which of the following states do not have state income tax deducted from employee pay?
(You may select more than one answer.)
A. Montana
B. Alaska
C. Maine
D. New Hampshire
Answer: B, D
Difficulty: 1 Easy
Bloom's: Understand
5
18) Which of the following is used in the determination of the amount of federal income tax to
be withheld from an employee per pay period? (You may select more than one answer.)
A. Date of birth
B. Period salary
C. Marital status
D. Prior year's tax return
Answer: B, C
Difficulty: 1 Easy
Bloom's: Understand
19) What role does the employer play regarding an employee's federal withholding tax?
A) Collector and depositor
B) Reporter and depositor
C) Collector and verifier
D) Verifier and reporter
Answer: A
Difficulty: 1 Easy
Bloom's: Understand
6
20) Amity is an employee with a period gross pay of $2,000. She elects to have 3% of her gross
pay withheld for her 401(k) contribution. What will be her taxable income be for federal income
taxes?
A) $2,000
B) $1,970
C) $1,940
D) $1,910
Answer: C
Explanation:
401(k)
Gross pay 401(k)% contribution Taxable wage
$2,000.00 3% $60.00 $1,940.00
Bloom's: Apply
7
21) Max earned $1,019.55 during the most recent semimonthly pay period. He is single with 1
withholding allowance and has no pre-tax deductions. Using the following table, how much
should be withheld for federal income tax?
Wage Bracket Method Tables for Income Tax Withholding

SINGLE Persons-SEMIMONTHLY Payroll Period
(For Wages Paid through December 31, 2018)
And the wages are And the number of withholding allowances claimed is-
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
The amount of income tax to be withheld is-
$ 800 $ 820 $ 71 $ 50 $ 31 $ 14 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 73 52 33 16 0 0 0 0 0 0 0
840 860 76 55 35 18 0 0 0 0 0 0 0
860 880 78 57 37 20 2 0 0 0 0 0 0
880 900 80 60 39 22 4 0 0 0 0 0 0
900 920 83 62 41 24 6 0 0 0 0 0 0
920 940 85 64 44 26 8 0 0 0 0 0 0
940 960 88 67 46 28 10 0 0 0 0 0 0
960 980 90 69 48 30 12 0 0 0 0 0 0
980 1,000 92 72 51 32 14 0 0 0 0 0 0
1,000 1,020 95 74 53 34 16 0 0 0 0 0 0
1,020 1,040 97 76 56 36 18 1 0 0 0 0 0
1,040 1,060 100 79 58 38 20 3 0 0 0 0 0
1,060 1,080 102 81 60 40 22 5 0 0 0 0 0
1,080 1,100 104 84 63 42 24 7 0 0 0 0 0
1,100 1,120 107 86 65 45 26 9 0 0 0 0 0
1,120 1,140 109 88 68 47 28 11 0 0 0 0 0
1,140 1,160 112 91 70 49 30 13 0 0 0 0 0
1,160 1,180 114 93 72 52 32 15 0 0 0 0 0
1,180 1,200 116 96 75 54 34 17 0 0 0 0 0
1,200 1,220 119 98 77 57 36 19 2 0 0 0 0
1,220 1,240 121 100 80 59 38 21 4 0 0 0 0
1,240 1,260 124 103 82 61 41 23 6 0 0 0 0
1,260 1,280 126 105 84 64 43 25 8 0 0 0 0
1,280 1,300 128 108 87 66 45 27 10 0 0 0 0
1,300 1,320 131 110 89 69 48 29 12 0 0 0 0
1,320 1,340 133 112 92 71 50 31 14 0 0 0 0
1,340 1,360 136 115 94 73 53 33 16 0 0 0 0
1,360 1,380 138 117 96 76 55 35 18 1 0 0 0
1,380 1,400 140 120 99 78 57 37 20 3 0 0 0
1,400 1,420 143 122 101 81 60 39 22 5 0 0 0
1,420 1,440 145 124 104 83 62 41 24 7 0 0 0
1,440 1,460 148 127 106 85 65 44 26 9 0 0 0
1,460 1,480 150 129 108 88 67 46 28 11 0 0 0
1,480 1,500 152 132 111 90 69 49 30 13 0 0 0
1,500 1,520 155 134 113 93 72 51 32 15 0 0 0
1,520 1,540 157 136 116 95 74 53 34 17 0 0 0
1,540 1,560 160 139 118 97 77 56 36 19 1 0 0
1,560 1,580 162 141 120 100 79 58 38 21 3 0 0
1,580 1,600 164 144 123 102 81 61 40 23 5 0 0
1,600 1,620 167 146 125 105 84 63 42 25 7 0 0
1,620 1,640 169 148 128 107 86 65 45 27 9 0 0
1,640 1,660 172 151 130 109 89 68 47 29 11 0 0
1,660 1,680 174 153 132 112 91 70 49 31 13 0 0
1,680 1,700 176 156 135 114 93 73 52 33 15 0 0
1,700 1,720 179 158 137 117 96 75 54 35 17 0 0
1,720 1,740 181 160 140 119 98 77 57 37 19 2 0
1,740 1,760 184 163 142 121 101 80 59 39 21 4 0
1,760 1,780 186 165 144 124 103 82 61 41 23 6 0
8
1,780 1,800 191 168 147 126 105 85 64 43 25 8 0
1,800 1,820 195 170 149 129 108 87 66 46 27 10 0
1,820 1,840 199 172 152 131 110 89 69 48 29 12 0
1,840 1,860 204 175 154 133 113 92 71 50 31 14 0
1,860 1,880 208 177 156 136 115 94 73 53 33 16 0
1,880 1,900 213 180 159 138 117 97 76 55 35 18 1
1,900 1,920 217 182 161 141 120 99 78 58 37 20 3
1,920 1,940 221 184 164 143 122 101 81 60 39 22 5
1,940 1,960 226 188 166 145 125 104 83 62 42 24 7
1,960 1,980 230 192 168 148 127 106 85 65 44 26 9
1,980 2,000 235 197 171 150 129 109 88 67 46 28 11
2,000 2,020 239 201 173 153 132 111 90 70 49 30 13
2,020 2,040 243 205 176 155 134 113 93 72 51 32 15
2,040 2,060 248 210 178 157 137 116 95 74 54 34 17
2,060 2,080 252 214 180 160 139 118 97 77 56 36 19
2,080 2,100 257 219 183 162 141 121 100 79 58 38 21
2,100 2,120 262 223 185 165 144 123 102 82 61 40 23
2,120 2,140 265 227 189 167 146 125 105 84 63 42 25
A) $95.00
B) $76.00
C) $51.00
D) $74.00
Answer: D
Bloom's: Apply
9
22) Trish earned $1,734.90 during the most recent semimonthly pay period. She is married and
has 3 withholding allowances and has no pre-tax deductions. Based on the following table, how
much should be withheld from her gross pay for Federal income tax?

MARRIED Persons-SEMIMONTHLY Payroll Period
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,605 $ 1,625 $ 120 $ 99 $ 79 $ 62 $ 44 $ 27 $ 10 $ 0 $ 0 $ 0 $ 0
1,625 1,645 123 102 81 64 46 29 12 0 0 0 0
1,645 1,665 125 104 83 66 48 31 14 0 0 0 0
1,665 1,685 127 107 86 68 50 33 16 0 0 0 0
1,685 1,705 130 109 88 70 52 35 18 0 0 0 0
1,705 1,725 132 111 91 72 54 37 20 2 0 0 0
1,725 1,745 135 114 93 74 56 39 22 4 0 0 0
1,745 1,765 137 116 95 76 58 41 24 6 0 0 0
1,765 1,785 139 119 98 78 60 43 26 8 0 0 0
1,785 1,805 142 121 100 80 62 45 28 10 0 0 0
1,805 1,825 144 123 103 82 64 47 30 12 0 0 0
1,825 1,845 147 126 105 84 66 49 32 14 0 0 0
1,845 1,865 149 128 107 87 68 51 34 16 0 0 0
1,865 1,885 151 131 110 89 70 53 36 18 1 0 0
1,885 1,905 154 133 112 92 72 55 38 20 3 0 0
1,905 1,925 156 135 115 94 74 57 40 22 5 0 0
1,925 1,945 159 138 117 96 76 59 42 24 7 0 0
1,945 1,965 161 140 119 99 78 61 44 26 9 0 0
1,965 1,985 163 143 122 101 80 63 46 28 11 0 0
1,985 2,005 166 145 124 104 83 65 48 30 13 0 0
2,005 2,025 168 147 127 106 85 67 50 32 15 0 0
2,025 2,045 171 150 129 108 88 69 52 34 17 0 0
2,045 2,065 173 152 131 111 90 71 54 36 19 2 0
2,065 2,085 175 155 134 113 92 73 56 38 21 4 0
2,085 2,105 178 157 136 116 95 75 58 40 23 6 0
2,105 2,125 180 159 139 118 97 77 60 42 25 8 0
2,125 2,145 183 162 141 120 100 79 62 44 27 10 0
2,145 2,165 185 164 143 123 102 81 64 46 29 12 0
2,165 2,185 187 167 146 125 104 84 66 48 31 14 0
2,185 2,205 190 169 148 128 107 86 68 50 33 16 0
2,205 2,225 192 171 151 130 109 88 70 52 35 18 0
2,225 2,245 195 174 153 132 112 91 72 54 37 20 2
2,245 2,265 197 176 155 135 114 93 74 56 39 22 4
2,265 2,285 199 179 158 137 116 96 76 58 41 24 6
2,285 2,305 202 181 160 140 119 98 78 60 43 26 8
2,305 2,325 204 183 163 142 121 100 80 62 45 28 10
2,325 2,345 207 186 165 144 124 103 82 64 47 30 12
2,345 2,365 209 188 167 147 126 105 84 66 49 32 14
2,365 2,385 211 191 170 149 128 108 87 68 51 34 16
2,385 2,405 214 193 172 152 131 110 89 70 53 36 18
2,405 2,425 216 195 175 154 133 112 92 72 55 38 20
2,425 2,445 219 198 177 156 136 115 94 74 57 40 22
2,445 2,465 221 200 179 159 138 117 96 76 59 42 24
2,465 2,485 223 203 182 161 140 120 99 78 61 44 26
2,485 2,505 226 205 184 164 143 122 101 81 63 46 28
2,505 2,525 228 207 187 166 145 124 104 83 65 48 30
2,525 2,545 231 210 189 168 148 127 106 85 67 50 32
2,545 2,565 233 212 191 171 150 129 108 88 69 52 34
2,565 2,585 235 215 194 173 152 132 111 90 71 54 36
10
2,585 2,605 238 217 196 176 155 134 113 93 73 56 38
2,605 2,625 240 219 199 178 157 136 116 95 75 58 40
2,625 2,645 243 222 201 180 160 139 118 97 77 60 42
2,645 2,665 245 224 203 183 162 141 120 100 79 62 44
2,665 2,685 247 227 206 185 164 144 123 102 81 64 46
2,685 2,705 250 229 208 188 167 146 125 105 84 66 48
2,705 2,725 252 231 211 190 169 148 128 107 86 68 50
2,725 2,745 255 234 213 192 172 151 130 109 89 70 52
2,745 2,765 257 236 215 195 174 153 132 112 91 72 54
2,765 2,785 259 239 218 197 176 156 135 114 93 74 56
2,785 2,805 262 241 220 200 179 158 137 117 96 76 58
2,805 2,825 264 243 223 202 181 160 140 119 98 78 60
2,825 2,845 267 246 225 204 184 163 142 121 101 80 62
2,845 2,865 269 248 227 207 186 165 144 124 103 82 64
2,865 2,885 271 251 230 209 188 168 147 126 105 85 66
2,885 2,905 274 253 232 212 191 170 149 129 108 87 68
2,905 2,925 276 255 235 214 193 172 152 131 110 89 70
2,925 2,945 279 258 237 216 196 175 154 133 113 92 72
A) $74.00
B) $93.00
C) $76.00
D) $95.00
Answer: A
Bloom's: Apply
11
23) Ramani earned $1,698.50 during the most recent biweekly pay period. He contributes $100
to his 401(k) plan. He is married and claims 3 withholding allowances. Based on the following
table, how much Federal income tax should be withheld from his pay?

MARRIED Persons-BIWEEKLY Payroll Period
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,465 $ 1,485 $ 109 $ 90 $ 71 $ 55 $ 39 $ 23 $ 7 $ 0 $ 0 $ 0 $ 0
1,485 1,505 111 92 73 67 41 25 9 0 0 0 0
1,505 1,525 114 95 76 59 43 27 11 0 0 0 0
1,525 1,545 116 97 78 61 45 29 13 0 0 0 0
1,545 1,565 119 99 80 63 47 31 15 0 0 0 0
1,565 1,585 121 102 83 65 49 33 17 1 0 0 0
1,585 1,605 123 104 85 67 51 35 19 3 0 0 0
1,605 1,625 126 107 88 69 53 37 21 5 0 0 0
1,625 1,645 128 109 90 71 55 39 23 7 0 0 0
1,645 1,665 131 111 92 73 57 41 25 9 0 0 0
1,665 1,685 133 114 95 76 59 43 27 11 0 0 0
1,685 1,705 135 116 97 78 61 45 29 13 0 0 0
1,705 1,725 138 119 100 80 63 47 31 0 0 0 0
1,725 1,745 140 121 102 83 65 49 33 17 1 0 0
1,745 1,765 143 123 104 85 67 51 35 19 3 0 0
1,765 1,785 145 126 107 88 69 53 37 21 5 0 0
1,785 1,805 147 128 109 90 71 55 39 23 7 0 0
1,805 1,825 150 131 112 92 73 57 41 25 9 0 0
1,825 1,845 152 133 114 95 76 59 43 27 11 0 0
1,845 1,865 155 135 116 97 78 61 45 29 13 0 0
1,865 1,885 157 138 119 100 80 63 47 31 15 0 0
1,885 1,905 159 140 121 102 83 65 49 33 17 1 0
1,905 1,925 162 143 124 104 85 67 51 35 19 3 0
1,925 1,945 164 145 126 107 88 69 53 37 21 5 0
1,945 1,965 167 147 128 109 90 71 55 39 23 7 0
1,965 1,985 169 150 150 112 92 73 57 41 25 9 0
1,985 2,005 171 152 133 114 95 76 59 43 27 11 0
2,005 2,025 174 155 136 116 97 78 61 45 29 13 0
2,025 2,045 176 157 138 119 100 80 63 47 31 15 0
2,045 2,065 179 159 140 121 102 83 65 49 33 17 1
2,065 2,085 181 162 143 124 104 85 67 51 35 19 3
2,085 2,105 183 164 145 126 107 88 69 53 37 21 5
2,105 2,125 186 167 148 128 109 90 71 55 39 23 7
2,125 2,145 188 169 150 131 112 92 73 57 41 25 9
2,145 2,165 191 171 152 133 114 95 76 59 43 27 11
2,165 2,185 193 174 155 136 116 97 78 61 45 29 13
2,185 2,205 195 176 157 138 119 100 81 63 47 31 15
2,205 2,225 198 179 160 140 121 102 83 65 49 33 17
2,225 2,245 200 181 162 143 124 104 85 67 51 35 19
2,245 2,265 203 183 164 145 126 107 88 69 53 37 21
2,265 2,285 205 186 167 148 128 109 90 71 55 39 23
2,285 2,305 207 188 169 150 131 112 93 73 57 41 25
2,305 2,325 210 191 172 152 133 114 95 76 59 43 27
2,325 2,345 212 193 174 155 136 116 97 78 61 45 29
2,345 2,365 215 195 176 157 138 119 100 81 63 47 31
2,365 2,385 217 198 179 160 140 121 102 83 65 49 33
2,385 2,405 219 200 181 162 143 124 105 85 67 51 35
2,405 2,425 222 203 184 164 145 126 107 88 69 53 37
2,425 2,445 224 205 186 167 148 128 109 90 71 55 39
12
2,445 2,465 227 207 188 169 150 131 112 93 73 57 41
2,465 2,485 229 210 191 172 152 133 114 95 76 59 43
2,485 2,505 231 212 193 174 155 136 117 97 78 61 45
2,505 2,525 234 215 196 176 157 138 119 100 81 63 47
2,525 2,545 236 217 198 179 160 140 121 102 83 65 49
2,545 2,565 239 219 200 181 162 143 124 105 85 67 51
2,565 2,585 241 222 203 184 164 145 126 107 88 69 53
2,585 2,605 243 224 205 186 167 148 129 109 90 71 55
2,605 2,625 246 227 208 188 169 150 131 112 93 73 57
2,625 2,645 248 229 210 191 172 152 133 114 95 76 59
2,645 2,665 251 231 212 193 174 155 136 117 97 78 61
2,665 2,685 253 234 215 196 176 157 138 119 100 81 63
2,685 2,705 255 236 217 198 179 160 141 121 102 83 65
2,705 2,725 258 239 220 200 181 162 143 124 105 85 67
2,725 2,745 260 241 222 203 184 164 145 126 107 88 69
2,745 2,765 263 243 224 205 186 167 148 129 109 90 71
2,765 2,785 265 246 227 208 188 169 150 131 112 93 74
2,785 2,805 267 248 229 210 191 172 153 133 114 95 76
2,805 2,825 270 251 232 212 193 174 155 136 117 97 78
2,825 2,845 272 253 234 215 196 176 157 138 119 100 81
2,845 2,865 275 255 236 217 198 179 160 141 121 102 83
2,865 2,885 277 258 239 220 200 181 162 143 124 105 86
A) $78.00
B) $73.00
C) $69.00
D) $67.00
Answer: D
Explanation:
Gross Pay 401(k) contribution Taxable wage
$1,698.50 $100.00 $1,598.50
Bloom's: Analyze
13
24) Caroljane earned $1,120 during the most recent pay biweekly pay period. She contributes 4%
of her gross pay to her 401(k) plan. She is single and has 1 withholding allowance. Based on the
following table, how much Federal income tax should be withheld from her pay?

SINGLE Persons-BIWEEKLY Payroll Period
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 800 $ 820 $ 73 $ 54 $ 35 $ 19 $ 3 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 75 56 37 21 5 0 0 0 0 0 0
840 860 78 58 39 23 7 0 0 0 0 0 0
860 880 80 61 42 25 9 0 0 0 0 0 0
880 900 82 63 44 27 11 0 0 0 0 0 0
900 920 85 66 46 29 13 0 0 0 0 0 0
920 940 87 68 49 31 15 0 0 0 0 0 0
940 960 90 70 51 33 17 1 0 0 0 0 0
960 980 92 73 54 35 19 3 0 0 0 0 0
980 1,000 94 75 56 37 21 5 0 0 0 0 0
1,000 1,020 97 78 58 39 23 7 0 0 0 0 0
1,020 1,040 99 80 61 42 25 9 0 0 0 0 0
1,040 1,060 102 82 63 44 27 11 0 0 0 0 0
1,060 1,080 104 85 66 47 29 13 0 0 0 0 0
1,080 1,100 106 87 68 49 31 15 0 0 0 0 0
1,100 1,120 109 90 70 51 33 17 1 0 0 0 0
1,120 1,140 111 92 73 54 35 19 3 0 0 0 0
1,140 1,160 114 94 75 56 37 21 5 0 0 0 0
1,160 1,180 116 97 78 59 39 23 7 0 0 0 0
1,180 1,200 118 99 80 61 42 25 9 0 0 0 0
1,200 1,220 121 102 82 63 44 27 11 0 0 0 0
1,220 1,240 123 104 85 66 47 29 13 0 0 0 0
1,240 1,260 126 106 87 68 49 31 15 0 0 0 0
1,260 1,280 128 109 90 71 51 33 17 1 0 0 0
1,280 1,300 130 111 92 73 54 35 19 3 0 0 0
1,300 1,320 133 114 94 75 56 37 21 5 0 0 0
1,320 1,340 135 116 97 78 59 39 23 7 0 0 0
1,340 1,360 138 118 99 80 61 42 25 9 0 0 0
1,360 1,380 140 121 102 83 63 44 27 11 0 0 0
1,380 1,400 142 123 104 85 66 47 29 13 0 0 0
1,400 1,420 145 126 106 87 68 49 31 15 0 0 0
1,420 1,440 147 128 109 90 71 51 33 17 1 0 0
1,440 1,460 150 130 111 92 73 54 35 19 3 0 0
1,460 1,480 152 133 114 95 75 56 37 21 5 0 0
1,480 1,500 154 135 116 97 78 59 39 23 7 0 0
1,500 1,520 157 138 118 99 80 61 42 25 9 0 0
1,520 1,540 159 140 121 102 83 63 44 27 11 0 0
1,540 1,560 162 142 123 104 85 66 47 29 13 0 0
1,560 1,580 164 145 126 107 87 68 49 31 15 0 0
1,580 1,600 166 147 128 109 90 71 51 33 17 1 0
1,600 1,620 169 150 130 111 92 73 54 35 19 3 0
1,620 1,640 171 152 133 114 95 75 56 37 21 5 0
1,640 1,660 176 154 135 116 97 78 59 40 23 7 0
1,660 1,680 180 157 138 119 99 80 61 42 25 9 0
1,680 1,700 184 159 140 121 102 83 63 44 27 11 0
1,700 1,720 189 162 142 123 104 85 66 47 29 13 0
1,720 1,740 193 164 145 126 107 87 68 49 31 15 0
1,740 1,760 198 166 147 128 109 90 71 52 33 17 1
1,760 1,780 202 169 150 131 111 92 73 54 35 19 3
14
1,780 1,800 206 171 152 133 114 95 75 56 37 21 5
1,800 1,820 211 176 154 135 116 97 78 59 40 23 7
1,820 1,840 215 180 157 138 119 99 80 61 42 25 9
1,840 1,860 220 184 159 140 121 102 83 64 44 27 11
1,860 1,880 224 189 162 143 123 104 85 66 47 29 13
1,880 1,900 228 193 164 145 126 107 87 68 49 31 15
1,900 1,920 233 198 166 147 128 109 90 71 52 33 17
1,920 1,940 237 202 169 150 131 111 92 73 54 35 19
1,940 1,960 242 206 171 152 133 114 95 76 56 37 21
1,960 1,980 246 211 176 155 135 116 97 78 59 40 23
1,980 2,000 250 215 180 157 138 119 99 80 61 42 25
2,000 2,020 255 220 184 159 140 121 102 83 64 44 27
2,020 2,040 259 224 189 162 143 123 104 85 66 47 29
2,040 2,060 264 228 193 164 145 126 107 88 68 49 31
2,060 2,080 268 233 198 167 147 128 109 90 71 52 33
2,080 2,100 272 237 202 169 150 131 111 92 73 54 35
A) $106.00
B) $104.00
C) $87.00
D) $85.00
Answer: D
Explanation:
Gross Pay 401(k)% 401(k) contribution Taxable wage
$1,120.00 4% $44.80 $1,075.20
Bloom's: Apply
15
25) Julio is single with 1 withholding allowance. He earned $1,025.00 during the most recent
semimonthly pay period. He needs to decide between contributing 3% and $30 to his 401(k)
plan. If he chooses the method that results in the lowest taxable income, how much will be
withheld for Federal income tax (based on the following table)?

SINGLE Persons-SEMIMONTHLY Payroll Period
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 800 $ 820 $ 71 $ 50 $ 31 $ 14 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 73 52 33 16 0 0 0 0 0 0 0
840 860 76 55 35 18 0 0 0 0 0 0 0
860 880 78 57 37 20 2 0 0 0 0 0 0
880 900 80 60 39 22 4 0 0 0 0 0 0
900 920 83 62 41 24 6 0 0 0 0 0 0
920 940 85 64 44 26 8 0 0 0 0 0 0
940 960 88 67 46 28 10 0 0 0 0 0 0
960 980 90 69 48 30 12 0 0 0 0 0 0
980 1,000 92 72 51 32 14 0 0 0 0 0 0
1,000 1,020 95 74 53 34 16 0 0 0 0 0 0
1,020 1,040 97 76 56 36 18 1 0 0 0 0 0
1,040 1,060 100 79 58 38 20 3 0 0 0 0 0
1,060 1,080 102 81 60 40 22 5 0 0 0 0 0
1,080 1,100 104 84 63 42 24 7 0 0 0 0 0
1,100 1,120 107 86 65 45 26 9 0 0 0 0 0
1,120 1,140 109 88 68 47 28 11 0 0 0 0 0
1,140 1,160 112 91 70 49 30 13 0 0 0 0 0
1,160 1,180 114 93 72 52 32 15 0 0 0 0 0
1,180 1,200 116 96 75 54 34 17 0 0 0 0 0
1,200 1,220 119 98 77 57 36 19 2 0 0 0 0
1,220 1,240 121 100 80 59 38 21 4 0 0 0 0
1,240 1,260 124 103 82 61 41 23 6 0 0 0 0
1,260 1,280 126 105 84 64 43 25 8 0 0 0 0
1,280 1,300 128 108 87 66 45 27 10 0 0 0 0
1,300 1,320 131 110 89 69 48 29 12 0 0 0 0
1,320 1,340 133 112 92 71 50 31 14 0 0 0 0
1,340 1,360 136 115 94 73 53 33 16 0 0 0 0
1,360 1,380 138 117 96 76 55 35 18 1 0 0 0
1,380 1,400 140 120 99 78 57 37 20 3 0 0 0
1,400 1,420 143 122 101 81 60 39 22 5 0 0 0
1,420 1,440 145 124 104 83 62 41 24 7 0 0 0
1,440 1,460 148 127 106 85 65 44 26 9 0 0 0
1,460 1,480 150 129 108 88 67 46 28 11 0 0 0
1,480 1,500 152 132 111 90 69 49 30 13 0 0 0
1,500 1,520 155 134 113 93 72 51 32 15 0 0 0
1,520 1,540 157 136 116 95 74 53 34 17 0 0 0
1,540 1,560 160 139 118 97 77 56 36 19 1 0 0
1,560 1,580 162 141 120 100 79 58 38 21 3 0 0
1,580 1,600 164 144 123 102 81 61 40 23 5 0 0
1,600 1,620 167 146 125 105 84 63 42 25 7 0 0
1,620 1,640 169 148 128 107 86 65 45 27 9 0 0
1,640 1,660 172 151 130 109 89 68 47 29 11 0 0
1,660 1,680 174 153 132 112 91 70 49 31 13 0 0
1,680 1,700 176 156 135 114 93 73 52 33 15 0 0
1,700 1,720 179 158 137 117 96 75 54 35 17 0 0
1,720 1,740 181 160 140 119 98 77 57 37 19 2 0
1,740 1,760 184 163 142 121 101 80 59 39 21 4 0
16
1,760 1,780 186 165 144 124 103 82 61 41 23 6 0
1,780 1,800 191 168 147 126 105 85 64 43 25 8 0
1,800 1,820 195 170 149 129 108 87 66 46 27 10 0
1,820 1,840 199 172 152 131 110 89 69 48 29 12 0
1,840 1,860 204 175 154 133 113 92 71 50 31 14 0
1,860 1,880 208 177 156 136 115 94 73 53 33 16 0
1,880 1,900 213 180 159 138 117 97 76 55 35 18 1
1,900 1,920 217 182 161 141 120 99 78 58 37 20 3
1,920 1,940 221 184 164 143 122 101 81 60 39 22 5
1,940 1,960 226 188 166 145 125 104 83 62 42 24 7
1,960 1,980 230 192 168 148 127 106 85 65 44 26 9
1,980 2,000 235 197 171 150 129 109 88 67 46 28 11
2,000 2,020 239 201 173 153 132 111 90 70 49 30 13
2,020 2,040 243 205 176 155 134 113 93 72 51 32 15
2,040 2,060 248 210 178 157 137 116 95 74 54 34 17
2,060 2,080 252 214 180 160 139 118 97 77 56 36 19
2,080 2,100 257 219 183 162 141 121 100 79 58 38 21
2,100 2,120 262 223 185 165 144 123 102 82 61 40 23
2,120 2,140 265 227 189 167 146 125 105 84 63 42 25
A) $79.00
B) $86.00
C) $74.00
D) Both yield the same tax amount
Answer: D
Explanation: $30 contribution
Gross pay 401(k) contribution Taxable wage
$1,025.00 $30.00 $995.00
3% contribution
Gross pay 401(k) % 401(k) contribution Taxable wage
$1,025.00 3% $30.75 $994.25
Difficulty: 3 Hard
Bloom's: Evaluate
17
26) Andie earned $680.20 during the most recent weekly pay period. She is single with 3
withholding allowances and needs to decide between contributing 2.5% and $25 to her 401(k)
plan. If she chooses the method that results in the lowest taxable income, how much will be
withheld for Federal income tax (based on the following table)?

SINGLE Persons-WEEKLY Payroll Period
But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 600 $ 610 $ 60 $ 51 $ 41 $ 32 $ 22 $ 13 $ 6 $ 0 $ 0 $ 0 $ 0
610 620 62 52 42 33 23 14 7 0 0 0 0
620 630 63 53 44 34 24 15 8 0 0 0 0
630 640 64 54 45 35 26 16 9 1 0 0 0
640 650 65 56 46 36 27 17 10 2 0 0 0
650 660 66 57 47 38 28 19 11 3 0 0 0
660 670 68 58 48 39 29 20 12 4 0 0 0
670 680 69 59 50 40 30 21 13 5 0 0 0
680 690 70 60 51 41 32 22 14 6 0 0 0
690 700 71 62 52 42 33 23 15 7 0 0 0
700 710 72 63 53 44 34 25 16 8 0 0 0
710 720 74 64 54 45 35 26 17 9 1 0 0
720 730 75 65 56 46 36 27 18 10 2 0 0
730 740 76 66 57 47 38 28 19 11 3 0 0
740 750 77 68 58 48 39 29 20 12 4 0 0
750 760 78 69 59 50 40 31 21 13 5 0 0
760 770 80 70 60 51 41 32 22 14 6 0 0
770 780 81 71 62 52 42 33 23 15 7 0 0
780 790 82 72 63 53 44 34 25 16 8 0 0
790 800 83 74 64 54 45 35 26 17 9 1 0
800 810 84 75 65 56 46 37 27 18 10 2 0
810 820 86 76 66 57 47 38 28 19 11 3 0
820 830 88 77 68 58 48 39 29 20 12 4 0
830 840 90 78 69 59 50 40 31 21 13 5 0
840 850 92 80 70 60 51 41 32 22 14 6 0
850 860 94 81 71 62 52 43 33 23 15 7 0
860 870 97 82 72 63 53 44 34 25 16 8 0
870 880 99 83 74 64 54 45 35 26 17 9 1
880 890 101 84 75 65 56 46 37 27 18 10 2
890 900 103 86 76 66 57 47 38 28 19 11 3
900 910 105 88 77 68 58 49 39 29 20 12 4
910 920 108 90 78 69 59 50 40 31 21 13 5
920 930 110 92 80 70 60 51 41 32 22 14 6
930 940 112 94 81 71 62 52 43 33 23 15 7
940 950 114 97 82 72 63 53 44 34 25 16 8
950 960 116 99 83 74 64 55 45 35 26 17 9
960 970 119 101 84 75 65 56 46 37 27 18 10
970 980 121 103 86 76 66 57 47 38 28 19 11
980 990 123 105 88 77 68 58 49 39 29 20 12
990 1,000 125 108 90 78 69 59 50 40 31 21 13
1,000 1,010 127 110 92 80 70 61 51 41 32 22 14
1,010 1,020 130 112 94 81 71 62 52 43 33 23 15
1,020 1,030 132 114 97 82 72 63 53 44 34 25 16
1,030 1,040 134 116 99 83 74 64 55 45 35 26 17
1,040 1,050 136 119 101 84 75 65 56 46 37 27 18
1,050 1,060 138 121 103 86 76 67 57 47 38 28 19
1,060 1,070 141 123 105 88 77 68 58 49 39 29 20
1,070 1,080 143 125 108 90 78 69 59 50 40 31 21
18
1,080 1,090 145 127 110 92 80 70 61 51 41 32 22
1,090 1,100 147 130 112 94 81 71 62 52 43 33 23
1,100 1,110 149 132 114 97 82 73 63 53 44 34 25
1,110 1,120 152 134 116 99 83 74 64 55 45 35 26
1,120 1,130 154 136 119 101 84 75 65 56 46 37 27
1,130 1,140 156 138 121 103 86 76 67 57 47 38 28
1,140 1,150 158 141 123 105 88 77 68 58 49 39 29
1,150 1,160 160 143 125 108 90 79 69 59 50 40 31
1,160 1,170 163 145 127 110 92 80 70 61 51 41 32
1,170 1,180 165 147 130 112 95 81 71 62 52 43 33
1,180 1,190 167 149 132 114 97 82 73 63 53 44 34
1,190 1,200 169 152 134 116 99 83 74 64 55 45 35
1,200 1,210 171 154 136 119 101 85 75 65 56 46 37
1,210 1,220 174 156 138 121 103 86 76 67 57 47 38
1,220 1,230 176 158 141 123 106 88 77 68 58 49 39
1,230 1,240 178 160 143 125 108 90 79 69 59 50 40
1,240 1,250 180 163 145 127 110 92 80 70 61 51 41
A) $40.00
B) $48.00
C) $38.00
D) $39.00
Answer: C
Explanation: 2.5% contribution
Gross pay 401(k) % 401(k) contribution Taxable wage Income Tax
$680.20 2.5% $17.01 $663.20 $39.00
$25 contribution
Gross pay 401(k) % 401(k) contribution Taxable wage Income Tax
$680.20 n/a $25.00 $655.20 $38.00
Difficulty: 3 Hard
Bloom's: Evaluate
19
27) Olga earned $1,558.00 during the most recent weekly pay period. She is single with 2
withholding allowances and no pre-tax deductions. Using the percentage method, compute
Olga's federal income tax for the period. (Do not round intermediate calculations. Round
final answer to 2 decimal places.)
Table 5. Percentage Method-2018 Amount for one Withholding Allowance
Payroll Period One Withholding

Allowance
Weekly $79.80
Biweekly 159.60
Semimonthly 172.90
Monthly 345.80
Quarterly 1,037.50
Semiannually 2,075.00
Annually 4,150.00
Daily or miscellaneous (each day of the payroll period) 16.00
Percentage Method Tables for Income Tax Withholding

(For Wages Paid in 2018)
TABLE 1-WEEKLY Payroll Period
(a) SINGLE person (including head of household)− (b) MARRIED person−
If the amount of wages If the amount of wages
(after subtracting (after subtracting
withholding allowances) The amount of income tax to withholding allowances) The amount of income tax to
is: withhold is: is: withhold is:
Not over $71...... $0 Not over $222...... $0
But not
Over− over− of excess over− Over− But not over− of excess over−
0.00 plus 0.00 plus
$ 71 −$ 254 $ % −$ 71 $ 222 −$ 588 $ % −$ 222
10 10
18.30 36.60
254 −$ 815 $ % −$ 254 $ 588 −$ 1,711 $ % −$ 588
$ plus 12 plus 12
85.62 171.36
$ 815 −$ 1,658 $ % −$ 815 $ 1,711 −$ 3,395 $ % −$ 1,711
plus 22 plus 22
271.07 541.84
$ 1,658 −$ 3,100 $ % −$ 1,658 $ 3,395 −$ 6,280 $ % −$ 3,395
plus 24 plus 24
617.16 1,234.24
$ 3,100 −$ 3,917 $ % −$ 3,100 $ 6,280 −$ 7,914 $ % −$ 6,280
plus 32 plus 32
878.60 1,757.12
$ 3,917 −$ 9,687 $ % −$ 3,917 $ 7,914 −$ 11,761 $ % −$ 7,914
plus 35 plus 35
2,898.10 3,103.57
$ 9,687 $ % −$ 9,687 $ 11,761 $ % −$ 11,761
plus 37 plus 37
A) $217.93
B) $239.25
C) $213.97
D) $214.75
20
Answer: C
Explanation:
Period salary/wage $ 1,558.00
# of allowance 2
Deduction per allowance $ 79.8
Taxable base $ 1,398.40
"of excess over..." $ 815
Adjusted base $ 583.40
Tax rate 22 %
Tax before margin $ 128.35
Marginal tax $ 85.62
Total tax $ 213.97
Bloom's: Apply
21
28) Warren is a married employee with six withholding allowances. During the most recent
biweekly pay period, he earned $9,450.00. Using the percentage method, compute Warren's
federal income tax. (Do not round intermediate calculations. Round your final answer to 2
decimal places.)

Allowance
Weekly $79.80
Biweekly 159.60
Semimonthly 172.90
Monthly 345.80
Quarterly 1,037.50
Annually 4,150.00
TABLE 2-BIWEEKLY Payroll Period

(after subtracting The amount of income tax to (after subtracting The amount of income tax to
withholding allowances) is: withhold is: withholding allowances) is: withhold is:
Not over $142...... $0 Not over $444...... $0
But not But not
Over− over− of excess over− Over− over− of excess over−
0.00 plus 0.00 plus
$ 142 -$ 509 $ % -$ 142 $ 444 -$ 1,177 $ % -$ 444
10 10
36.70 plus 73.30
509 -$ 1,631 $ % -$ 509 $ 1,177 -$ 3,421 $ % -$ 1,177
$ 12 plus 12
171.34 plus 342.58
$ 1,631 -$ 3,315 $ % -$ 1,631 $ 3,421 -$ 6,790 $ % -$ 3,421
22 plus 22
541.82 plus 1,083.76
$ 3,315 -$ 6,200 $ % -$ 3,315 $ 6,790 -$ 12,560 $ % -$ 6,790
24 plus 24
1,234.22 2,468.56
$ 6,200 -$ 7,835 $ % -$ 6,200 $ 12,560 -$ 15,829 $ % -$ 12,560
plus 32 plus 32
1,757.42 3,514.64
$ 7,835 -$ 19,373 $ % -$ 7,835 $ 15,829 -$ 23,521 $ % -$ 15,829
plus 35 plus 35
5,795.72 6,206.84
$ 19,373 $ % -$ 19,373 $ 23,521 $ % -$ 23,521
plus 37 plus 37
A) $1,490.15
B) $1,456.90
C) $1,512.91
D) $1,492.34
22
Answer: D
Explanation:
# of allowances 6
"of excess over..." $ 6,790
Adjusted base $ 1,702.40
Tax rate 24 %
Marginal tax $ 1,083.76
Total tax $ 1,492.34
Bloom's: Apply
29) Adam is a part-time employee who earned $495.00 during the most recent pay period. He is
married with two withholding allowances. Prior to this pay period, his year-to-date pay is
$6,492.39. How much should be withheld from Adam's gross pay for Social Security tax?
A) $40.02
B) $30.69
C) $37.92
D) $28.46
Answer: B
Explanation:
Period Prior YTD Taxable Social Security Social
wage/Salary earning amount tax rate Security tax
$495.00 $6,492.39 $495.00 6.2% $30.69
Difficulty: 1 Easy
Bloom's: Apply
23
30) Jeannie is an adjunct faculty at a local college, where she earned $680.00 during the most
recent semimonthly pay period. Her prior year-to-date pay is $18,540. She is single and has one
withholding allowance. What is her Social Security tax for the pay period?
A) $48.02
B) $39.24
C) $44.18
D) $42.16
Answer: D
Explanation:
Social
Period Prior YTD Taxable Security Social Security
wage/Salary earning amount tax rate tax
$680.00 $18,540.00 $680.00 6.2% $42.16
Difficulty: 1 Easy
Bloom's: Apply
31) Paolo is a part-time security guard for a local facility. He earned $298.50 during the most
recent weekly pay period and has earned $5,296.00 year-to-date. He is married with four
withholding allowances. What is his Medicare tax liability for the pay period?
A) $43.23
B) $10.54
C) $8.65
D) $4.33
Answer: D
Explanation:
Period Prior YTD Taxable Medicare tax Medicare
wage/Salary earning amount rate tax
$298.50 $5,296.00 $298.50 1.45% $4.33
Difficulty: 1 Easy
Bloom's: Apply
24
32) Steve is a full-time exempt employee at a local electricity co-operative. He earns an annual
salary of $43,325 and is paid biweekly. What is his Social Security tax deduction for each pay
period? (Do not round intermediate calculations. Round your final answer to 2 decimal
places.)
A) $123.95
B) $103.31
C) $98.67
D) $106.34
Answer: B
Explanation:
Social
Annual Period Taxable Security Social Security
Salary wage/Salary amount tax rate tax
$43,325.00 $1,666.35 $1,666.35 6.2% $103.31
Bloom's: Analyze
33) Renee is a salaried exempt employee who earns an annual salary of $64,200, which is paid
semimonthly. She is married with four withholding allowances. What is her total FICA tax
liability per pay period? (Do not round intermediate calculations. Round your final answer
to 2 decimal places.)
A) $165.85
B) $38.79
C) $204.64
D) $409.28
Answer: C
Explanation:
Annual Period Taxable FICA tax
Salary wage/salary amount rate FICA tax
$64,200.00 $2,675.00 $2,675.00 7.65% $204.64
Bloom's: Analyze
25
34) Natalia is a full-time exempt employee who earns $215,000 annually, paid monthly. Her
year-to-date pay as of November 30 is $197,083.33. How much will be withheld from Natalia for
FICA taxes for the December 31 pay date? (Social Security maximum wage is $128,400. Do
not round intermediate calculations. Round your final answer to 2 decimal places.)
A) $292.04
B) $394.79
C) $1,370.63
D) $421.04
Answer: B
Explanation: Part of Natalia's pay is subject to the additional Medicare tax, none is subject to
Social Security tax.
Taxable
amount Medicar
Annual Period Prior YTD (Medicare Medicare e
Salary wage/Salary earnings only) tax rate tax
$215,000.00 $17,916.67 $197,083.33 $17,916.67 1.45% $259.79
$15,000.00 0.9% $135.00
Total Medicare tax $394.79
Difficulty: 3 Hard
Bloom's: Evaluate
26
35) Wyatt is a full-time exempt music engineer who earns $130,000 annually and is paid
semimonthly. As of December 15, his year-to-date gross pay was $124,583.33. How much will
be withheld for FICA taxes for the December 31 pay date? (Social Security maximum wage is
$128,400. Do not round intermediate calculations. Round your final answer to 2 decimal
places.)
A) $335.83
B) $414.38
C) $352.88
D) $315.18
Answer: D
Explanation: Only part of Wyatt's wages is subject to Social Security tax, all is subject to
Medicare tax.
Social
Annual Period Prior YTD Security Medicare
Salary wage/Salary earnings taxable taxable FICA tax
$130,000.00 $5,416.67 $124,583.33 $3,816.67 $5,416.67 $315.18
Difficulty: 3 Hard
Bloom's: Analyze
27
36) Melody is a full-time employee in Sioux City, South Dakota, who earns $3,600 per month
and is paid semimonthly. She is married with 1 withholding allowance (use the wage-bracket
tables). She has a qualified health insurance deduction of $50 per pay period and contributes 3%
to her 401(k), both of which are pre-tax deductions. What is her net pay? (Round your
intermediate calculations and final answer to 2 decimal places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,605 $ 1,625 $ 120 $ 99 $ 79 $ 62 $ 44 $ 27 $ 10 $ 0 $ 0 $ 0 $ 0
1,625 1,645 123 102 81 64 46 29 12 0 0 0 0
1,645 1,665 125 104 83 66 48 31 14 0 0 0 0
1,665 1,685 127 107 86 68 50 33 16 0 0 0 0
1,685 1,705 130 109 88 70 52 35 18 0 0 0 0
1,705 1,725 132 111 91 72 54 37 20 2 0 0 0
1,725 1,745 135 114 93 74 56 39 22 4 0 0 0
1,745 1,765 137 116 95 76 58 41 24 6 0 0 0
1,765 1,785 139 119 98 78 60 43 26 8 0 0 0
1,785 1,805 142 121 100 80 62 45 28 10 0 0 0
1,805 1,825 144 123 103 82 64 47 30 12 0 0 0
1,825 1,845 147 126 105 84 66 49 32 14 0 0 0
1,845 1,865 149 128 107 87 68 51 34 16 0 0 0
1,865 1,885 151 131 110 89 70 53 36 18 1 0 0
1,885 1,905 154 133 112 92 72 55 38 20 3 0 0
1,905 1,925 156 135 115 94 74 57 40 22 5 0 0
1,925 1,945 159 138 117 96 76 59 42 24 7 0 0
1,945 1,965 161 140 119 99 78 61 44 26 9 0 0
1,965 1,985 163 143 122 101 80 63 46 28 11 0 0
1,985 2,005 166 145 124 104 83 65 48 30 13 0 0
2,005 2,025 168 147 127 106 85 67 50 32 15 0 0
2,025 2,045 171 150 129 108 88 69 52 34 17 0 0
2,045 2,065 173 152 131 111 90 71 54 36 19 2 0
2,065 2,085 175 155 134 113 92 73 56 38 21 4 0
2,085 2,105 178 157 136 116 95 75 58 40 23 6 0
2,105 2,125 180 159 139 118 97 77 60 42 25 8 0
2,125 2,145 183 162 141 120 100 79 62 44 27 10 0
2,145 2,165 185 164 143 123 102 81 64 46 29 12 0
2,165 2,185 187 167 146 125 104 84 66 48 31 14 0
2,185 2,205 190 169 148 128 107 86 68 50 33 16 0
2,205 2,225 192 171 151 130 109 88 70 52 35 18 0
2,225 2,245 195 174 153 132 112 91 72 54 37 20 2
2,245 2,265 197 176 155 135 114 93 74 56 39 22 4
2,265 2,285 199 179 158 137 116 96 76 58 41 24 6
2,285 2,305 202 181 160 140 119 98 78 60 43 26 8
2,305 2,325 204 183 163 142 121 100 80 62 45 28 10
2,325 2,345 207 186 165 144 124 103 82 64 47 30 12
2,345 2,365 209 188 167 147 126 105 84 66 49 32 14
2,365 2,385 211 191 170 149 128 108 87 68 51 34 16
2,385 2,405 214 193 172 152 131 110 89 70 53 36 18
2,405 2,425 216 195 175 154 133 112 92 72 55 38 20
2,425 2,445 219 198 177 156 136 115 94 74 57 40 22
2,445 2,465 221 200 179 159 138 117 96 76 59 42 24
2,465 2,485 223 203 182 161 140 120 99 78 61 44 26
2,485 2,505 226 205 184 164 143 122 101 81 63 46 28
2,505 2,525 228 207 187 166 145 124 104 83 65 48 30
28
2,525 2,545 231 210 189 168 148 127 106 85 67 50 32
2,545 2,565 233 212 191 171 150 129 108 88 69 52 34
2,565 2,585 235 215 194 173 152 132 111 90 71 54 36
2,585 2,605 238 217 196 176 155 134 113 93 73 56 38
2,605 2,625 240 219 199 178 157 136 116 95 75 58 40
2,625 2,645 243 222 201 180 160 139 118 97 77 60 42
2,645 2,665 245 224 203 183 162 141 120 100 79 62 44
2,665 2,685 247 227 206 185 164 144 123 102 81 64 46
2,685 2,705 250 229 208 188 167 146 125 105 84 66 48
2,705 2,725 252 231 211 190 169 148 128 107 86 68 50
2,725 2,745 255 234 213 192 172 151 130 109 89 70 52
2,745 2,765 257 236 215 195 174 153 132 112 91 72 54
2,765 2,785 259 239 218 197 176 156 135 114 93 74 56
2,785 2,805 262 241 220 200 179 158 137 117 96 76 58
2,805 2,825 264 243 223 202 181 160 140 119 98 78 60
2,825 2,845 267 246 225 204 184 163 142 121 101 80 62
2,845 2,865 269 248 227 207 186 165 144 124 103 82 64
2,865 2,885 271 251 230 209 188 168 147 126 105 85 66
2,885 2,905 274 253 232 212 191 170 149 129 108 87 68
2,905 2,925 276 255 235 214 193 172 152 131 110 89 70
2,925 2,945 279 258 237 216 196 175 154 133 113 92 72
A) $1,696.00
B) $1,524.27
C) $1,453.12
D) $1,394.87
Answer: C
Explanation:
Topic: Compute Employee Net Pay; Determine Federal Income Tax Withholding Amounts;
Compute Social Security and Medicare Tax Withholding
Learning Objective: 05-01 Compute Employee Net Pay; 05-02 Determine Federal Income Tax
Withholding Amounts; 05-03 Compute Social Security and Medicare Tax Withholding
Bloom's: Analyze
29
37) Julian is a part-time nonexempt employee in Nashville, Tennessee, who earns $21.50 per
hour. During the last biweekly pay period he worked 45 hours, 5 of which are considered
overtime. He is single with one withholding allowance (use the wage-bracket table). What is his
net pay? (Do not round intermediate calculations. Round your final answer to 2 decimal
places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 800 $ 820 $ 73 $ 54 $ 35 $ 19 $ 3 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 75 56 37 21 5 0 0 0 0 0 0
840 860 78 58 39 23 7 0 0 0 0 0 0
860 880 80 61 42 25 9 0 0 0 0 0 0
880 900 82 63 44 27 11 0 0 0 0 0 0
900 920 85 66 46 29 13 0 0 0 0 0 0
920 940 87 68 49 31 15 0 0 0 0 0 0
940 960 90 70 51 33 17 1 0 0 0 0 0
960 980 92 73 54 35 19 3 0 0 0 0 0
980 1,000 94 75 56 37 21 5 0 0 0 0 0
1,000 1,020 97 78 58 39 23 7 0 0 0 0 0
1,020 1,040 99 80 61 42 25 9 0 0 0 0 0
1,040 1,060 102 82 63 44 27 11 0 0 0 0 0
1,060 1,080 104 85 66 47 29 13 0 0 0 0 0
1,080 1,100 106 87 68 49 31 15 0 0 0 0 0
1,100 1,120 109 90 70 51 33 17 1 0 0 0 0
1,120 1,140 111 92 73 54 35 19 3 0 0 0 0
1,140 1,160 114 94 75 56 37 21 5 0 0 0 0
1,160 1,180 116 97 78 59 39 23 7 0 0 0 0
1,180 1,200 118 99 80 61 42 25 9 0 0 0 0
1,200 1,220 121 102 82 63 44 27 11 0 0 0 0
1,220 1,240 123 104 85 66 47 29 13 0 0 0 0
1,240 1,260 126 106 87 68 49 31 15 0 0 0 0
1,260 1,280 128 109 90 71 51 33 17 1 0 0 0
1,280 1,300 130 111 92 73 54 35 19 3 0 0 0
1,300 1,320 133 114 94 75 56 37 21 5 0 0 0
1,320 1,340 135 116 97 78 59 39 23 7 0 0 0
1,340 1,360 138 118 99 80 61 42 25 9 0 0 0
1,360 1,380 140 121 102 83 63 44 27 11 0 0 0
1,380 1,400 142 123 104 85 66 47 29 13 0 0 0
1,400 1,420 145 126 106 87 68 49 31 15 0 0 0
1,420 1,440 147 128 109 90 71 51 33 17 1 0 0
1,440 1,460 150 130 111 92 73 54 35 19 3 0 0
1,460 1,480 152 133 114 95 75 56 37 21 5 0 0
1,480 1,500 154 135 116 97 78 59 39 23 7 0 0
1,500 1,520 157 138 118 99 80 61 42 25 9 0 0
1,520 1,540 159 140 121 102 83 63 44 27 11 0 0
1,540 1,560 162 142 123 104 85 66 47 29 13 0 0
1,560 1,580 164 145 126 107 87 68 49 31 15 0 0
1,580 1,600 166 147 128 109 90 71 51 33 17 1 0
1,600 1,620 169 150 130 111 92 73 54 35 19 3 0
1,620 1,640 171 152 133 114 95 75 56 37 21 5 0
1,640 1,660 176 154 135 116 97 78 59 40 23 7 0
1,660 1,680 180 157 138 119 99 80 61 42 25 9 0
1,680 1,700 184 159 140 121 102 83 63 44 27 11 0
1,700 1,720 189 162 142 123 104 85 66 47 29 13 0
30
1,720 1,740 193 164 145 126 107 87 68 49 31 15 0
1,740 1,760 198 166 147 128 109 90 71 52 33 17 1
1,760 1,780 202 169 150 131 111 92 73 54 35 19 3
1,780 1,800 206 171 152 133 114 95 75 56 37 21 5
1,800 1,820 211 176 154 135 116 97 78 59 40 23 7
1,820 1,840 215 180 157 138 119 99 80 61 42 25 9
1,840 1,860 220 184 159 140 121 102 83 64 44 27 11
1,860 1,880 224 189 162 143 123 104 85 66 47 29 13
1,880 1,900 228 193 164 145 126 107 87 68 49 31 15
1,900 1,920 233 198 166 147 128 109 90 71 52 33 17
1,920 1,940 237 202 169 150 131 111 92 73 54 35 19
1,940 1,960 242 206 171 152 133 114 95 76 56 37 21
1,960 1,980 246 211 176 155 135 116 97 78 59 40 23
1,980 2,000 250 215 180 157 138 119 99 80 61 42 25
2,000 2,020 255 220 184 159 140 121 102 83 64 44 27
2,020 2,040 259 224 189 162 143 123 104 85 66 47 29
2,040 2,060 264 228 193 164 145 126 107 88 68 49 31
2,060 2,080 268 233 198 167 147 128 109 90 71 52 33
2,080 2,100 272 237 202 169 150 131 111 92 73 54 35
A) $818.40
B) $797.18
C) $825.99
D) $863.12
Answer: D
Explanation:
Compute Social Security and Medicare Tax Withholding
Withholding Amounts; 05-03 Compute Social Security and Medicare Tax Withholding
Bloom's: Analyze
31
38) Disposable income is defined as:
A) An employee's net pay less living expenses like rent and utilities.
B) An employee's taxable income less Understand Post-Tax Deductions.
C) An employee's gross pay less Identify Pre-Tax Deductions.
D) An employee's pay after legally required deductions have been withheld.
Answer: D
Difficulty: 1 Easy
Bloom's: Understand
39) Sammy contributes 4% of her salary to a 401(k) plan, $50 per pay period to a charitable
contribution, $140 per pay period to union dues, and $50 per pay period to a section 125
qualified insurance plan offered by her employer. Which contributions must be taken on a post-
tax basis? (You may select more than one answer.)
A. 401(k) contribution
B. Section 125 insurance plan
C. Union dues
D. Charitable contribution
Answer: C, D
Difficulty: 1 Easy
Bloom's: Understand
40) Garnishments may include deductions from employee wages on a post-tax basis for items
such as: (You may select more than one answer.)
A. Charitable contributions.
B. Union Dues.
C. Child Support payments.
D. Consumer Credit liens.
Answer: C, D
Difficulty: 1 Easy
Bloom's: Remember
32
41) Why might an employee elect to have additional federal income tax withheld? (You may
select more than one answer.)
A. Charitable contributions.
B. Union Dues.
C. Child Support payments.
D. Consumer Credit liens.
Answer: A, C, D
Difficulty: 1 Easy
Bloom's: Understand
33
42) Manju is a full-time exempt employee living in Illinois who earns $43,680 annually and is
paid biweekly. She is married with three withholding allowances. What is the total of her Federal
and state income tax deductions for the most recent pay period? (Use the wage bracket tables.
Illinois state income tax rate is 3.75%.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,465 $ 1,485 $ 109 $ 90 $ 71 $ 55 $ 39 $ 23 $ 7 $ 0 $ 0 $ 0 $ 0
1,485 1,505 111 92 73 67 41 25 9 0 0 0 0
1,505 1,525 114 95 76 59 43 27 11 0 0 0 0
1,525 1,545 116 97 78 61 45 29 13 0 0 0 0
1,545 1,565 119 99 80 63 47 31 15 0 0 0 0
1,565 1,585 121 102 83 65 49 33 17 1 0 0 0
1,585 1,605 123 104 85 67 51 35 19 3 0 0 0
1,605 1,625 126 107 88 69 53 37 21 5 0 0 0
1,625 1,645 128 109 90 71 55 39 23 7 0 0 0
1,645 1,665 131 111 92 73 57 41 25 9 0 0 0
1,665 1,685 133 114 95 76 59 43 27 11 0 0 0
1,685 1,705 135 116 97 78 61 45 29 13 0 0 0
1,705 1,725 138 119 100 80 63 47 31 0 0 0 0
1,725 1,745 140 121 102 83 65 49 33 17 1 0 0
1,745 1,765 143 123 104 85 67 51 35 19 3 0 0
1,765 1,785 145 126 107 88 69 53 37 21 5 0 0
1,785 1,805 147 128 109 90 71 55 39 23 7 0 0
1,805 1,825 150 131 112 92 73 57 41 25 9 0 0
1,825 1,845 152 133 114 95 76 59 43 27 11 0 0
1,845 1,865 155 135 116 97 78 61 45 29 13 0 0
1,865 1,885 157 138 119 100 80 63 47 31 15 0 0
1,885 1,905 159 140 121 102 83 65 49 33 17 1 0
1,905 1,925 162 143 124 104 85 67 51 35 19 3 0
1,925 1,945 164 145 126 107 88 69 53 37 21 5 0
1,945 1,965 167 147 128 109 90 71 55 39 23 7 0
1,965 1,985 169 150 150 112 92 73 57 41 25 9 0
1,985 2,005 171 152 133 114 95 76 59 43 27 11 0
2,005 2,025 174 155 136 116 97 78 61 45 29 13 0
2,025 2,045 176 157 138 119 100 80 63 47 31 15 0
2,045 2,065 179 159 140 121 102 83 65 49 33 17 1
2,065 2,085 181 162 143 124 104 85 67 51 35 19 3
2,085 2,105 183 164 145 126 107 88 69 53 37 21 5
2,105 2,125 186 167 148 128 109 90 71 55 39 23 7
2,125 2,145 188 169 150 131 112 92 73 57 41 25 9
2,145 2,165 191 171 152 133 114 95 76 59 43 27 11
2,165 2,185 193 174 155 136 116 97 78 61 45 29 13
2,185 2,205 195 176 157 138 119 100 81 63 47 31 15
2,205 2,225 198 179 160 140 121 102 83 65 49 33 17
2,225 2,245 200 181 162 143 124 104 85 67 51 35 19
2,245 2,265 203 183 164 145 126 107 88 69 53 37 21
2,265 2,285 205 186 167 148 128 109 90 71 55 39 23
2,285 2,305 207 188 169 150 131 112 93 73 57 41 25
2,305 2,325 210 191 172 152 133 114 95 76 59 43 27
2,325 2,345 212 193 174 155 136 116 97 78 61 45 29
2,345 2,365 215 195 176 157 138 119 100 81 63 47 31
2,365 2,385 217 198 179 160 140 121 102 83 65 49 33
2,385 2,405 219 200 181 162 143 124 105 85 67 51 35
2,405 2,425 222 203 184 164 145 126 107 88 69 53 37
34
2,425 2,445 224 205 186 167 148 128 109 90 71 55 39
2,445 2,465 227 207 188 169 150 131 112 93 73 57 41
2,465 2,485 229 210 191 172 152 133 114 95 76 59 43
2,485 2,505 231 212 193 174 155 136 117 97 78 61 45
2,505 2,525 234 215 196 176 157 138 119 100 81 63 47
2,525 2,545 236 217 198 179 160 140 121 102 83 65 49
2,545 2,565 239 219 200 181 162 143 124 105 85 67 51
2,565 2,585 241 222 203 184 164 145 126 107 88 69 53
2,585 2,605 243 224 205 186 167 148 129 109 90 71 55
2,605 2,625 246 227 208 188 169 150 131 112 93 73 57
2,625 2,645 248 229 210 191 172 152 133 114 95 76 59
2,645 2,665 251 231 212 193 174 155 136 117 97 78 61
2,665 2,685 253 234 215 196 176 157 138 119 100 81 63
2,685 2,705 255 236 217 198 179 160 141 121 102 83 65
2,705 2,725 258 239 220 200 181 162 143 124 105 85 67
2,725 2,745 260 241 222 203 184 164 145 126 107 88 69
2,745 2,765 263 243 224 205 186 167 148 129 109 90 71
2,765 2,785 265 246 227 208 188 169 150 131 112 93 74
2,785 2,805 267 248 229 210 191 172 153 133 114 95 76
2,805 2,825 270 251 232 212 193 174 155 136 117 97 78
2,825 2,845 272 253 234 215 196 176 157 138 119 100 81
2,845 2,865 275 255 236 217 198 179 160 141 121 102 83
2,865 2,885 277 258 239 220 200 181 162 143 124 105 86
A) $139
B) $142
C) $148
D) $151
Answer: A
Explanation:
Annual Period Federal State income Total Federal and
Salary wage/Salary income tax tax State income tax
$43,680.00 $1,680.00 $76.00 $63.00 $139.00
Topic: Determine Federal Income Tax Withholding Amounts; Calculate State and Local
Income Taxes
Learning Objective: 05-02 Determine Federal Income Tax Withholding Amounts; 05-04
Calculate State and Local Income Taxes
Bloom's: Analyze
35
43) Tierney is a full-time nonexempt salaried employee who earns $990 per biweekly pay
period. She is single with 1 withholding allowance and both lives and works in Maryland.
Assuming that she had no overtime, what is the total of her Federal and state taxes for a pay
period? (Use the wage-bracket tables. Maryland state income rate is 2.0%. Round final
answer to 2 decimal places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 800 $ 820 $ 73 $ 54 $ 35 $ 19 $ 3 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 75 56 37 21 5 0 0 0 0 0 0
840 860 78 58 39 23 7 0 0 0 0 0 0
860 880 80 61 42 25 9 0 0 0 0 0 0
880 900 82 63 44 27 11 0 0 0 0 0 0
900 920 85 66 46 29 13 0 0 0 0 0 0
920 940 87 68 49 31 15 0 0 0 0 0 0
940 960 90 70 51 33 17 1 0 0 0 0 0
960 980 92 73 54 35 19 3 0 0 0 0 0
980 1,000 94 75 56 37 21 5 0 0 0 0 0
1,000 1,020 97 78 58 39 23 7 0 0 0 0 0
1,020 1,040 99 80 61 42 25 9 0 0 0 0 0
1,040 1,060 102 82 63 44 27 11 0 0 0 0 0
1,060 1,080 104 85 66 47 29 13 0 0 0 0 0
1,080 1,100 106 87 68 49 31 15 0 0 0 0 0
1,100 1,120 109 90 70 51 33 17 1 0 0 0 0
1,120 1,140 111 92 73 54 35 19 3 0 0 0 0
1,140 1,160 114 94 75 56 37 21 5 0 0 0 0
1,160 1,180 116 97 78 59 39 23 7 0 0 0 0
1,180 1,200 118 99 80 61 42 25 9 0 0 0 0
1,200 1,220 121 102 82 63 44 27 11 0 0 0 0
1,220 1,240 123 104 85 66 47 29 13 0 0 0 0
1,240 1,260 126 106 87 68 49 31 15 0 0 0 0
1,260 1,280 128 109 90 71 51 33 17 1 0 0 0
1,280 1,300 130 111 92 73 54 35 19 3 0 0 0
1,300 1,320 133 114 94 75 56 37 21 5 0 0 0
1,320 1,340 135 116 97 78 59 39 23 7 0 0 0
1,340 1,360 138 118 99 80 61 42 25 9 0 0 0
1,360 1,380 140 121 102 83 63 44 27 11 0 0 0
1,380 1,400 142 123 104 85 66 47 29 13 0 0 0
1,400 1,420 145 126 106 87 68 49 31 15 0 0 0
1,420 1,440 147 128 109 90 71 51 33 17 1 0 0
1,440 1,460 150 130 111 92 73 54 35 19 3 0 0
1,460 1,480 152 133 114 95 75 56 37 21 5 0 0
1,480 1,500 154 135 116 97 78 59 39 23 7 0 0
1,500 1,520 157 138 118 99 80 61 42 25 9 0 0
1,520 1,540 159 140 121 102 83 63 44 27 11 0 0
1,540 1,560 162 142 123 104 85 66 47 29 13 0 0
1,560 1,580 164 145 126 107 87 68 49 31 15 0 0
1,580 1,600 166 147 128 109 90 71 51 33 17 1 0
1,600 1,620 169 150 130 111 92 73 54 35 19 3 0
1,620 1,640 171 152 133 114 95 75 56 37 21 5 0
1,640 1,660 176 154 135 116 97 78 59 40 23 7 0
1,660 1,680 180 157 138 119 99 80 61 42 25 9 0
1,680 1,700 184 159 140 121 102 83 63 44 27 11 0
1,700 1,720 189 162 142 123 104 85 66 47 29 13 0
36
1,720 1,740 193 164 145 126 107 87 68 49 31 15 0
1,740 1,760 198 166 147 128 109 90 71 52 33 17 1
1,760 1,780 202 169 150 131 111 92 73 54 35 19 3
1,780 1,800 206 171 152 133 114 95 75 56 37 21 5
1,800 1,820 211 176 154 135 116 97 78 59 40 23 7
1,820 1,840 215 180 157 138 119 99 80 61 42 25 9
1,840 1,860 220 184 159 140 121 102 83 64 44 27 11
1,860 1,880 224 189 162 143 123 104 85 66 47 29 13
1,880 1,900 228 193 164 145 126 107 87 68 49 31 15
1,900 1,920 233 198 166 147 128 109 90 71 52 33 17
1,920 1,940 237 202 169 150 131 111 92 73 54 35 19
1,940 1,960 242 206 171 152 133 114 95 76 56 37 21
1,960 1,980 246 211 176 155 135 116 97 78 59 40 23
1,980 2,000 250 215 180 157 138 119 99 80 61 42 25
2,000 2,020 255 220 184 159 140 121 102 83 64 44 27
2,020 2,040 259 224 189 162 143 123 104 85 66 47 29
2,040 2,060 264 228 193 164 145 126 107 88 68 49 31
2,060 2,080 268 233 198 167 147 128 109 90 71 52 33
2,080 2,100 272 237 202 169 150 131 111 92 73 54 35
A) $84.25
B) $94.80
C) $95.95
D) $100.78
Answer: B
Explanation:
Period State income Total Federal and
wage/Salary Federal income tax tax State income tax
$990.00 $75.00 $19.80 $94.80
Topic: Determine Federal Income Tax Withholding Amounts; Calculate State and Local
Income Taxes
Bloom's: Analyze
37
44) Brent is a full-time exempt employee in Clark County, Indiana. He earns an annual salary of
$45,000 and is paid semimonthly. He is married with 3 withholding allowances. His state income
tax per pay period is $57.38, and Clark County income tax is $33.75 per pay period. What is the
total of FICA, Federal, state, and local deductions per pay period, assuming no Pre-Tax
Deductions? (Use the wage-bracket table to determine Federal taxes. Do not round
intermediate calculations. Round your final answer to 2 decimal places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,605 $ 1,625 $ 120 $ 99 $ 79 $ 62 $ 44 $ 27 $ 10 $ 0 $ 0 $ 0 $ 0
1,625 1,645 123 102 81 64 46 29 12 0 0 0 0
1,645 1,665 125 104 83 66 48 31 14 0 0 0 0
1,665 1,685 127 107 86 68 50 33 16 0 0 0 0
1,685 1,705 130 109 88 70 52 35 18 0 0 0 0
1,705 1,725 132 111 91 72 54 37 20 2 0 0 0
1,725 1,745 135 114 93 74 56 39 22 4 0 0 0
1,745 1,765 137 116 95 76 58 41 24 6 0 0 0
1,765 1,785 139 119 98 78 60 43 26 8 0 0 0
1,785 1,805 142 121 100 80 62 45 28 10 0 0 0
1,805 1,825 144 123 103 82 64 47 30 12 0 0 0
1,825 1,845 147 126 105 84 66 49 32 14 0 0 0
1,845 1,865 149 128 107 87 68 51 34 16 0 0 0
1,865 1,885 151 131 110 89 70 53 36 18 1 0 0
1,885 1,905 154 133 112 92 72 55 38 20 3 0 0
1,905 1,925 156 135 115 94 74 57 40 22 5 0 0
1,925 1,945 159 138 117 96 76 59 42 24 7 0 0
1,945 1,965 161 140 119 99 78 61 44 26 9 0 0
1,965 1,985 163 143 122 101 80 63 46 28 11 0 0
1,985 2,005 166 145 124 104 83 65 48 30 13 0 0
2,005 2,025 168 147 127 106 85 67 50 32 15 0 0
2,025 2,045 171 150 129 108 88 69 52 34 17 0 0
2,045 2,065 173 152 131 111 90 71 54 36 19 2 0
2,065 2,085 175 155 134 113 92 73 56 38 21 4 0
2,085 2,105 178 157 136 116 95 75 58 40 23 6 0
2,105 2,125 180 159 139 118 97 77 60 42 25 8 0
2,125 2,145 183 162 141 120 100 79 62 44 27 10 0
2,145 2,165 185 164 143 123 102 81 64 46 29 12 0
2,165 2,185 187 167 146 125 104 84 66 48 31 14 0
2,185 2,205 190 169 148 128 107 86 68 50 33 16 0
2,205 2,225 192 171 151 130 109 88 70 52 35 18 0
2,225 2,245 195 174 153 132 112 91 72 54 37 20 2
2,245 2,265 197 176 155 135 114 93 74 56 39 22 4
2,265 2,285 199 179 158 137 116 96 76 58 41 24 6
2,285 2,305 202 181 160 140 119 98 78 60 43 26 8
2,305 2,325 204 183 163 142 121 100 80 62 45 28 10
2,325 2,345 207 186 165 144 124 103 82 64 47 30 12
2,345 2,365 209 188 167 147 126 105 84 66 49 32 14
2,365 2,385 211 191 170 149 128 108 87 68 51 34 16
2,385 2,405 214 193 172 152 131 110 89 70 53 36 18
2,405 2,425 216 195 175 154 133 112 92 72 55 38 20
2,425 2,445 219 198 177 156 136 115 94 74 57 40 22
2,445 2,465 221 200 179 159 138 117 96 76 59 42 24
2,465 2,485 223 203 182 161 140 120 99 78 61 44 26
2,485 2,505 226 205 184 164 143 122 101 81 63 46 28
38
2,505 2,525 228 207 187 166 145 124 104 83 65 48 30
2,525 2,545 231 210 189 168 148 127 106 85 67 50 32
2,545 2,565 233 212 191 171 150 129 108 88 69 52 34
2,565 2,585 235 215 194 173 152 132 111 90 71 54 36
2,585 2,605 238 217 196 176 155 134 113 93 73 56 38
2,605 2,625 240 219 199 178 157 136 116 95 75 58 40
2,625 2,645 243 222 201 180 160 139 118 97 77 60 42
2,645 2,665 245 224 203 183 162 141 120 100 79 62 44
2,665 2,685 247 227 206 185 164 144 123 102 81 64 46
2,685 2,705 250 229 208 188 167 146 125 105 84 66 48
2,705 2,725 252 231 211 190 169 148 128 107 86 68 50
2,725 2,745 255 234 213 192 172 151 130 109 89 70 52
2,745 2,765 257 236 215 195 174 153 132 112 91 72 54
2,765 2,785 259 239 218 197 176 156 135 114 93 74 56
2,785 2,805 262 241 220 200 179 158 137 117 96 76 58
2,805 2,825 264 243 223 202 181 160 140 119 98 78 60
2,825 2,845 267 246 225 204 184 163 142 121 101 80 62
2,845 2,865 269 248 227 207 186 165 144 124 103 82 64
2,865 2,885 271 251 230 209 188 168 147 126 105 85 66
2,885 2,905 274 253 232 212 191 170 149 129 108 87 68
2,905 2,925 276 255 235 214 193 172 152 131 110 89 70
2,925 2,945 279 258 237 216 196 175 154 133 113 92 72
A) $303.36
B) $306.45
C) $318.13
D) $323.57
Answer: D
Explanation:
Total
Federal State Local Fed, state
Annual Period income income income & FICA
Salary wage/salary tax tax tax FICA tax tax
$45,000.00 $1,875.00 $89.00 $57.38 $33.75 $143.44 $323.57
Topic: Determine Federal Income Tax Withholding Amounts; Compute Social Security and
Medicare Tax Withholding; Calculate State and Local Income Taxes
Compute Social Security and Medicare Tax Withholding; 05-04 Calculate State and Local
Income Taxes
Bloom's: Analyze
39
45) Vivienne is a full-time exempt employee in DeKalb County, Indiana, and is paid biweekly.
She earns $39,000 annually, and is married with 2 withholding allowances. Her state income tax
deduction is $44.46, and the DeKalb County income tax deduction is $19.62. What is the total
amount of her FICA, federal, state, and local taxes per pay period, assuming no Pre-Tax
Deductions? (Use the wage-bracket table to determine the federal tax deduction. Do not
round intermediate calculations. Round your final answer to 2 decimal places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 1,465 $ 1,485 $ 109 $ 90 $ 71 $ 55 $ 39 $ 23 $ 7 $ 0 $ 0 $ 0 $ 0
1,485 1,505 111 92 73 67 41 25 9 0 0 0 0
1,505 1,525 114 95 76 59 43 27 11 0 0 0 0
1,525 1,545 116 97 78 61 45 29 13 0 0 0 0
1,545 1,565 119 99 80 63 47 31 15 0 0 0 0
1,565 1,585 121 102 83 65 49 33 17 1 0 0 0
1,585 1,605 123 104 85 67 51 35 19 3 0 0 0
1,605 1,625 126 107 88 69 53 37 21 5 0 0 0
1,625 1,645 128 109 90 71 55 39 23 7 0 0 0
1,645 1,665 131 111 92 73 57 41 25 9 0 0 0
1,665 1,685 133 114 95 76 59 43 27 11 0 0 0
1,685 1,705 135 116 97 78 61 45 29 13 0 0 0
1,705 1,725 138 119 100 80 63 47 31 0 0 0 0
1,725 1,745 140 121 102 83 65 49 33 17 1 0 0
1,745 1,765 143 123 104 85 67 51 35 19 3 0 0
1,765 1,785 145 126 107 88 69 53 37 21 5 0 0
1,785 1,805 147 128 109 90 71 55 39 23 7 0 0
1,805 1,825 150 131 112 92 73 57 41 25 9 0 0
1,825 1,845 152 133 114 95 76 59 43 27 11 0 0
1,845 1,865 155 135 116 97 78 61 45 29 13 0 0
1,865 1,885 157 138 119 100 80 63 47 31 15 0 0
1,885 1,905 159 140 121 102 83 65 49 33 17 1 0
1,905 1,925 162 143 124 104 85 67 51 35 19 3 0
1,925 1,945 164 145 126 107 88 69 53 37 21 5 0
1,945 1,965 167 147 128 109 90 71 55 39 23 7 0
1,965 1,985 169 150 150 112 92 73 57 41 25 9 0
1,985 2,005 171 152 133 114 95 76 59 43 27 11 0
2,005 2,025 174 155 136 116 97 78 61 45 29 13 0
2,025 2,045 176 157 138 119 100 80 63 47 31 15 0
2,045 2,065 179 159 140 121 102 83 65 49 33 17 1
2,065 2,085 181 162 143 124 104 85 67 51 35 19 3
2,085 2,105 183 164 145 126 107 88 69 53 37 21 5
2,105 2,125 186 167 148 128 109 90 71 55 39 23 7
2,125 2,145 188 169 150 131 112 92 73 57 41 25 9
2,145 2,165 191 171 152 133 114 95 76 59 43 27 11
2,165 2,185 193 174 155 136 116 97 78 61 45 29 13
2,185 2,205 195 176 157 138 119 100 81 63 47 31 15
2,205 2,225 198 179 160 140 121 102 83 65 49 33 17
2,225 2,245 200 181 162 143 124 104 85 67 51 35 19
2,245 2,265 203 183 164 145 126 107 88 69 53 37 21
2,265 2,285 205 186 167 148 128 109 90 71 55 39 23
2,285 2,305 207 188 169 150 131 112 93 73 57 41 25
2,305 2,325 210 191 172 152 133 114 95 76 59 43 27
2,325 2,345 212 193 174 155 136 116 97 78 61 45 29
2,345 2,365 215 195 176 157 138 119 100 81 63 47 31
40
2,365 2,385 217 198 179 160 140 121 102 83 65 49 33
2,385 2,405 219 200 181 162 143 124 105 85 67 51 35
2,405 2,425 222 203 184 164 145 126 107 88 69 53 37
2,425 2,445 224 205 186 167 148 128 109 90 71 55 39
2,445 2,465 227 207 188 169 150 131 112 93 73 57 41
2,465 2,485 229 210 191 172 152 133 114 95 76 59 43
2,485 2,505 231 212 193 174 155 136 117 97 78 61 45
2,505 2,525 234 215 196 176 157 138 119 100 81 63 47
2,525 2,545 236 217 198 179 160 140 121 102 83 65 49
2,545 2,565 239 219 200 181 162 143 124 105 85 67 51
2,565 2,585 241 222 203 184 164 145 126 107 88 69 53
2,585 2,605 243 224 205 186 167 148 129 109 90 71 55
2,605 2,625 246 227 208 188 169 150 131 112 93 73 57
2,625 2,645 248 229 210 191 172 152 133 114 95 76 59
2,645 2,665 251 231 212 193 174 155 136 117 97 78 61
2,665 2,685 253 234 215 196 176 157 138 119 100 81 63
2,685 2,705 255 236 217 198 179 160 141 121 102 83 65
2,705 2,725 258 239 220 200 181 162 143 124 105 85 67
2,725 2,745 260 241 222 203 184 164 145 126 107 88 69
2,745 2,765 263 243 224 205 186 167 148 129 109 90 71
2,765 2,785 265 246 227 208 188 169 150 131 112 93 74
2,785 2,805 267 248 229 210 191 172 153 133 114 95 76
2,805 2,825 270 251 232 212 193 174 155 136 117 97 78
2,825 2,845 272 253 234 215 196 176 157 138 119 100 81
2,845 2,865 275 255 236 217 198 179 160 141 121 102 83
2,865 2,885 277 258 239 220 200 181 162 143 124 105 86
A) $239.25
B) $227.12
C) $265.47
D) $251.83
Answer: D
Explanation:
Total
Federal,
Federal State Local State,
Annual Period income income income local, and
Salary wage/Salary tax tax tax FICA tax FICA tax
$39,000.00 $1,500.00 $73.00 $44.46 $19.62 $114.75 $251.83
Topic: Determine Federal Income Tax Withholding Amounts; Compute Social Security and
Medicare Tax Withholding; Calculate State and Local Income Taxes
Compute Social Security and Medicare Tax Withholding; 05-04 Calculate State and Local
Income Taxes
Bloom's: Analyze
41
46) Danny is a full-time exempt employee in Alabama, where the state income tax rate is 5%. He
earns $78,650 annually and is paid semimonthly. He is married with four withholding
allowances. His health insurance is $100.00 per pay period and is deducted on a pre-tax basis.
Danny contributes 5% of his pay to his 401(k). Assuming that he has no other deductions, what
is Danny's net pay for the period? (Use the percentage method for the federal income tax and
the wage-bracket table for the state income tax. Do not round intermediate calculations.
Round your final answer to 2 decimal places.)
One Withholding
Payroll Period Allowance
Weekly $79.80
Biweekly 159.60
Semimonthly 172.90
Monthly 345.80
Quarterly 1,037.50
Annually 4,150.00
TABLE 3-SEMIMONTHLY Payroll Period

(a) SINGLE person (including head of household)— (b) MARRIED person—
If the amount of wages (after If the amount of wages (after
subtracting withholding The amount of income tax to subtracting withholding The amount of income tax to
allowances) is: withhold is: allowances) is: withhold is:
Not over $154...... $0 Not over $481...... $0
Over- But not over- of excess over- Over- But not over- of excess over-
0.00 plus
$ 154 −$ 551 $ % −$ 154 $ 481 -$ 1,275 $ 0.00 plus 10% −$ 481
10
39.70 plus
551 −$ 1,767 $ % −$ 551 $ 1,275 -$ 3,706 $ 79.40 plus 12% −$ 1,275
$ 12
185.62 plus 371.12 plus
$ 1,767 −$ 3,592 $ % −$ 1,767 $ 3,706 -$ 7,356 $ % −$ 3,706
22 22
587.12 plus 1,174.12 plus
$ 3,592 −$ 6,717 $ % −$ 3,592 $ 7,356 -$ 13,606 $ % −$ 7,356
24 24
1,337.12 2,674.12 plus
$ 6,717 −$ 8,488 $ % −$ 6,717 $ 13,606 -$ 17,148 $ % −$ 13,606
plus 32 32
1,903.84 3807.56 plus
$ 8,488 −$ 20,988 $ % −$ 8,488 $ 17,148 -$ 25,481 $ % −$ 17,148
plus 35 35
6,278.84 6,724.11 plus
$ 20,988 $ % −$ 20,988 $ 25,481 $ % −$ 25,481
plus 37 37
A) $2,245.53
B) $2,403.95
C) $2,414.53
D) $2,178.90
42
Answer: C
Explanation:
Federal Income Tax computation
401(k) at 5% $ 163.85
Pretax Health $ 100.00
Federal Taxable $ 3,013.23
# of allowances 4
"of excess over…" $ 1,275.00
Tax rate 12%
Total Tax $ 205.00
Taxable
Hourly rate wages for Taxable Social
# or Period Gross Federal wages for Federal Security Medicare State
Name M/S W/H wage Earning Insurance 401(k) W/H FICA W/H Tax W/H W/H tax Net Pay
Danny M 4 $3,277.08$3,277.08 $100.00$163.85 $3,013.23 $3,177.08 $205.00 $196.98 $46.07 $150.66$2,414.53
Difficulty: 3 Hard
Compute Social Security and Medicare Tax Withholding; Calculate State and Local Income
Taxes
Withholding Amounts; 05-03 Compute Social Security and Medicare Tax Withholding; 05-04
Bloom's: Evaluate
43
47) Amanda is a full-time exempt employee in Sparks, Nevada, who earns $84,000 annually. She
is married with 1 deduction and is paid biweekly. She contributes $150.00 per pay period to her
401(k) and has pre-tax health insurance and AFLAC deductions of $50.00 and $75.00,
respectively. Amanda contributes $25.00 per pay period to the United Way. What is her net pay?
(Use the percentage method. Do not round intermediate calculations. Round final answers
to 2 decimal places.)

Allowance
Weekly $79.80
Biweekly 159.60
Semimonthly 172.90
Monthly 345.80
Quarterly 1,037.50
Annually 4,150.00
TABLE 2-BIWEEKLY Payroll Period

(after subtracting The amount of income tax to (after subtracting The amount of income tax to
withholding allowances) is: withhold is: withholding allowances) is: withhold is:
Not over $142...... $0 Not over $444...... $0
But not But not
Over− over− of excess over− Over− over− of excess over−
0.00 plus 0.00 plus
$ 142 -$ 509 $ % -$ 142 $ 444 -$ 1,177 $ % -$ 444
10 10
36.70 plus 73.30
509 -$ 1,631 $ % -$ 509 $ 1,177 -$ 3,421 $ % -$ 1,177
$ 12 plus 12
171.34 plus 342.58
$ 1,631 -$ 3,315 $ % -$ 1,631 $ 3,421 -$ 6,790 $ % -$ 3,421
22 plus 22
541.82 plus 1,083.76
$ 3,315 -$ 6,200 $ % -$ 3,315 $ 6,790 -$ 12,560 $ % -$ 6,790
24 plus 24
1,234.22 2,468.56
$ 6,200 -$ 7,835 $ % -$ 6,200 $ 12,560 -$ 15,829 $ % -$ 12,560
plus 32 plus 32
1,757.42 3,514.64
$ 7,835 -$ 19,373 $ % -$ 7,835 $ 15,829 -$ 23,521 $ % -$ 15,829
plus 35 plus 35
5,795.72 6,206.84
$ 19,373 $ % -$ 19,373 $ 23,521 $ % -$ 23,521
plus 37 plus 37
A) $2,394.47
B) $2,193.60
C) $2,425.58
D) $2,605.44
44
Answer: C
Explanation:
Federal Income tax using percentage method
Less: 401(k) $ 150.00
Less: Health Insurance $ 50.00
Less: AFLAC pretax $ 75.00
Federal Taxable Income $ 2,955.77
# of allowances 1
Tax rate 12 %
Total tax $ 267.60
Tax-
Hourly able Tax- So-
rate or wages for able cial
# Period Gross Federal wages for Federal Security Medicare United
Name M/SW/H wage Earning InsuranceAFLAC 401(k) W/H FICA W/H Tax W/H way Net Pay
Amanda M 1 $3,230.77 $3,230.77 $50.00 $75.00$150.00 $2,955.77 $3,105.77 $267.60 $192.56 $45.03 $25.00$2,425.58
Difficulty: 3 Hard
Compute Social Security and Medicare Tax Withholding; Apply Post-Tax Deductions
Apply Post-Tax Deductions
Bloom's: Evaluate
45
48) Collin is a full-time exempt employee in Juneau, Alaska, who earns $135,000 annually and
has not yet reached the Social Security wage base. He is single with 1 withholding allowance and
is paid semimonthly. He contributes 3% per pay period to his 401(k) and has pre-tax health
insurance and AFLAC deductions of $150 and $25, respectively. Collin has a child support
garnishment of $300 per pay period. What is his net pay? (Use the percentage method. Do not
round intermediate calculations. Round your final answer to 2 decimal places.)
Federal Income tax using percentage method

Allowance
Weekly $79.80
Biweekly 159.60
Semimonthly 172.90
Monthly 345.80
Quarterly 1,037.50
Annually 4,150.00
TABLE 3-SEMIMONTHLY Payroll Period

(a) SINGLE person (including head of household)— (b) MARRIED person—
If the amount of wages (after If the amount of wages (after
subtracting withholding The amount of income tax to subtracting withholding The amount of income tax to
allowances) is: withhold is: allowances) is: withhold is:
Not over $154...... $0 Not over $481...... $0
Over- But not over- of excess over- Over- But not over- of excess over-
0.00 plus 0.00 plus
$ 154 −$ 551 $ % −$ 154 $ 481 -$ 1,275 $ % −$ 481
10 10
39.70 plus 79.40 plus
551 −$ 1,767 $ % −$ 551 $ 1,275 -$ 3,706 $ % −$ 1,275
$ 12 12
185.62 plus 371.12 plus
$ 1,767 −$ 3,592 $ % −$ 1,767 $ 3,706 -$ 7,356 $ % −$ 3,706
22 22
587.12 plus 1,174.12
$ 3,592 −$ 6,717 $ % −$ 3,592 $ 7,356 -$ 13,606 $ % −$ 7,356
24 plus 24
1,337.12 2,674.12
$ 6,717 −$ 8,488 $ % −$ 6,717 $ 13,606 -$ 17,148 $ % −$ 13,606
plus 32 plus 32
1,903.84 3807.56
$ 8,488 −$ 20,988 $ % −$ 8,488 $ 17,148 -$ 25,481 $ % −$ 17,148
plus 35 plus 35
6,278.84 6,724.11
$ 20,988 $ % −$ 20,988 $ 25,481 $ % −$ 25,481
plus 37 plus 37
A) $3,653.05
B) $3,613.28
C) $3,974.60
D) $3,885.14
46
Answer: B
Explanation: Federal Income tax using percentage method
Less: 401(k)at 3% $ 168.75
Less: Health Insurance $ 150.00
Less: AFLAC pre-tax $ 25.00
Federal Taxable Income $ 5,281.25
# of allowances 1
Tax rate 24 %
Total tax $ 951.04
Difficulty: 3 Hard
Bloom's: Evaluate
49) Which of the following is the correct sequence for computing net pay?
A) Compute gross pay then deduct withholding and add FICA taxes to obtain net pay.
B) Compute gross pay, compute FICA, deduct pre-tax amounts, and deduct taxes.
C) Compute gross pay, deduct taxes, and add voluntary deductions.
D) Compute gross pay, deduct pre-tax amounts, compute FICA, deduct taxes, and deduct post-
tax amounts.
Answer: D
Difficulty: 1 Easy
Bloom's: Understand
47
50) Maile is a full-time exempt employee in Boca Raton, Florida, who earns $1,370.15 per
biweekly payday. She is married with seven withholding allowances, so her federal income tax is
$0. She contributes 4% of her gross pay to her 401(k) and has her health insurance premium of
$50 deducted on a pre-tax basis. She has $10 deducted per pay period for a Salvation Army
contribution and has union dues of $40 per pay period. What is her net pay? (Do not round
intermediate calculations. Round your final answer to 2 decimal places.)
A) $1,160.53
B) $1,114.35
C) $1,124.23
D) $1,137.93
Answer: B
Explanation:
Topic: Compute Employee Net Pay; Compute Social Security and Medicare Tax Withholding;
Learning Objective: 05-01 Compute Employee Net Pay; 05-03 Compute Social Security and
Medicare Tax Withholding; 05-05 Apply Post-Tax Deductions
Bloom's: Apply
48
51) Jesse is a part-time nonexempt employee in Austin, Texas, who earns $12.50 per hour.
During the last biweekly pay period he worked 35 hours. He is married with zero withholding
allowances, which means his federal income tax deduction is $10.00, and has additional federal
tax withholding of $30 per pay period. What is his net pay? (Do not round intermediate
calculations. Round your final answer to 2 decimal places.)
A) $354.28
B) $374.03
C) $364.03
D) $378.03
Answer: C
Explanation:
Hourly Taxable
# rate or No. of wages for Taxable Social
W/ Period Regular Gross Federal wages for Federal Security Medicare
Name M/S H wage Hours Earning W/H FICA W/H Tax W/H Net Pay
Jesse M 0 $12.50 35 $437.50 $437.50 $437.50 $40.00 $27.13 $6.34 $364.03
Topic: Compute Employee Net Pay; Compute Social Security and Medicare Tax Withholding;
Learning Objective: 05-01 Compute Employee Net Pay; 05-03 Compute Social Security and
Medicare Tax Withholding; 05-05 Apply Post-Tax Deductions
Bloom's: Apply
49
52) Janna is a salaried nonexempt employee in Laramie, Wyoming, who earns $30,000 per year
for a standard 40-hour workweek and is paid biweekly. She is single with one withholding
allowance. During the last pay period, she worked 5 hours of overtime. She contributes 3% of
her gross pay to her 401(k) on a pre-tax basis and has a garnishment of 10% of her disposable
income for a consumer credit garnishment. What is her net pay? (Use the wage-bracket
method. Do not round intermediate calculations. Round your final answer to 2 decimal
places.)

But less
At least 0 1 2 3 4 5 6 7 8 9 10
than
$ 800 $ 820 $ 73 $ 54 $ 35 $ 19 $ 3 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
820 840 75 56 37 21 5 0 0 0 0 0 0
840 860 78 58 39 23 7 0 0 0 0 0 0
860 880 80 61 42 25 9 0 0 0 0 0 0
880 900 82 63 44 27 11 0 0 0 0 0 0
900 920 85 66 46 29 13 0 0 0 0 0 0
920 940 87 68 49 31 15 0 0 0 0 0 0
940 960 90 70 51 33 17 1 0 0 0 0 0
960 980 92 73 54 35 19 3 0 0 0 0 0
980 1,000 94 75 56 37 21 5 0 0 0 0 0
1,000 1,020 97 78 58 39 23 7 0 0 0 0 0
1,020 1,040 99 80 61 42 25 9 0 0 0 0 0
1,040 1,060 102 82 63 44 27 11 0 0 0 0 0
1,060 1,080 104 85 66 47 29 13 0 0 0 0 0
1,080 1,100 106 87 68 49 31 15 0 0 0 0 0
1,100 1,120 109 90 70 51 33 17 1 0 0 0 0
1,120 1,140 111 92 73 54 35 19 3 0 0 0 0
1,140 1,160 114 94 75 56 37 21 5 0 0 0 0
1,160 1,180 116 97 78 59 39 23 7 0 0 0 0
1,180 1,200 118 99 80 61 42 25 9 0 0 0 0
1,200 1,220 121 102 82 63 44 27 11 0 0 0 0
1,220 1,240 123 104 85 66 47 29 13 0 0 0 0
1,240 1,260 126 106 87 68 49 31 15 0 0 0 0
1,260 1,280 128 109 90 71 51 33 17 1 0 0 0
1,280 1,300 130 111 92 73 54 35 19 3 0 0 0
1,300 1,320 133 114 94 75 56 37 21 5 0 0 0
1,320 1,340 135 116 97 78 59 39 23 7 0 0 0
1,340 1,360 138 118 99 80 61 42 25 9 0 0 0
1,360 1,380 140 121 102 83 63 44 27 11 0 0 0
1,380 1,400 142 123 104 85 66 47 29 13 0 0 0
1,400 1,420 145 126 106 87 68 49 31 15 0 0 0
1,420 1,440 147 128 109 90 71 51 33 17 1 0 0
1,440 1,460 150 130 111 92 73 54 35 19 3 0 0
1,460 1,480 152 133 114 95 75 56 37 21 5 0 0
1,480 1,500 154 135 116 97 78 59 39 23 7 0 0
1,500 1,520 157 138 118 99 80 61 42 25 9 0 0
1,520 1,540 159 140 121 102 83 63 44 27 11 0 0
1,540 1,560 162 142 123 104 85 66 47 29 13 0 0
1,560 1,580 164 145 126 107 87 68 49 31 15 0 0
1,580 1,600 166 147 128 109 90 71 51 33 17 1 0
1,600 1,620 169 150 130 111 92 73 54 35 19 3 0
1,620 1,640 171 152 133 114 95 75 56 37 21 5 0
1,640 1,660 176 154 135 116 97 78 59 40 23 7 0
1,660 1,680 180 157 138 119 99 80 61 42 25 9 0
50
1,680 1,700 184 159 140 121 102 83 63 44 27 11 0
1,700 1,720 189 162 142 123 104 85 66 47 29 13 0
1,720 1,740 193 164 145 126 107 87 68 49 31 15 0
1,740 1,760 198 166 147 128 109 90 71 52 33 17 1
1,760 1,780 202 169 150 131 111 92 73 54 35 19 3
1,780 1,800 206 171 152 133 114 95 75 56 37 21 5
1,800 1,820 211 176 154 135 116 97 78 59 40 23 7
1,820 1,840 215 180 157 138 119 99 80 61 42 25 9
1,840 1,860 220 184 159 140 121 102 83 64 44 27 11
1,860 1,880 224 189 162 143 123 104 85 66 47 29 13
1,880 1,900 228 193 164 145 126 107 87 68 49 31 15
1,900 1,920 233 198 166 147 128 109 90 71 52 33 17
1,920 1,940 237 202 169 150 131 111 92 73 54 35 19
1,940 1,960 242 206 171 152 133 114 95 76 56 37 21
1,960 1,980 246 211 176 155 135 116 97 78 59 40 23
1,980 2,000 250 215 180 157 138 119 99 80 61 42 25
2,000 2,020 255 220 184 159 140 121 102 83 64 44 27
2,020 2,040 259 224 189 162 143 123 104 85 66 47 29
2,040 2,060 264 228 193 164 145 126 107 88 68 49 31
2,060 2,080 268 233 198 167 147 128 109 90 71 52 33
2,080 2,100 272 237 202 169 150 131 111 92 73 54 35
A) $998.90
B) $913.90
C) $917.46
D) $886.96
Answer: C
Explanation:
Topic: Compute Employee Net Pay; Apply Post-Tax Deductions
Learning Objective: 05-01 Compute Employee Net Pay; 05-05 Apply Post-Tax Deductions
Bloom's: Analyze
51
53) Which of the following is true about cash as a method of paying employees?
A) Cash is the most secure payment method.
B) Cash is the most widely used payment method.
C) Cash is readily transferable and highly liquid.
D) Cash is the most convenient pay method for employers.
Answer: C
Difficulty: 1 Easy
Bloom's: Understand
54) Why do employers use checks as an employment payment method?

A) Paying employees by check allows the employer flexibility with its bank accounts.
B) Paying employees by check increases the complexity of the payroll process.
C) Paying employees by check requires the employer to keep currency on the premises.
D) Paying employees by check offers a level of security of employee payments.
Answer: D
Difficulty: 1 Easy
Bloom's: Understand
55) Best practices for paying employees by check include which of the following? (You may
select more than one answer.)
A. Maintenance of a separate checking account for payroll purposes.
B. Keeping a single check register for the firm's checking accounts.
C. Logging the number, amount, and purpose of each check used.
D. Establishing an unclaimed property account for uncashed checks.
Answer: A, C, D
Difficulty: 1 Easy
Bloom's: Understand
52
56) What is an advantage of direct deposit from the employee's perspective?
A) Long processing times for pay disbursements.
B) Secure access to compensation.
C) The requirement to have a bank account.
D) Access to payroll data on non-secured website.
Answer: B
Difficulty: 1 Easy
Bloom's: Understand
57) From the employer's perspective, which of the following is a challenge of paying employees
by direct deposit?
A) Reduction in payroll processing costs.
B) Secure processing of employee compensation.
C) Vulnerability of data to computer attacks.
D) Employee self-maintenance of personnel records.
Answer: C
Difficulty: 1 Easy
Bloom's: Understand
58) Which body issued Regulation E to protect consumers from loss of deposited funds?
A) Department of Homeland Security
B) Internal Revenue Service
C) American Banking Association
D) Federal Deposit Insurance Corporation
Answer: D
Difficulty: 1 Easy
Bloom's: Understand
53
59) What is a disadvantage to using paycards as a method of transmitting employee
compensation?
A) Convenience of retrieving pay disbursements.
B) Potential withdrawal and point-of-sale limitations.
C) Ease of paying traveling employees.
D) Acceptance of paycards at many locations.
Answer: B
Difficulty: 1 Easy
Bloom's: Understand
60) Which of the following payment methods is growing in popularity among employees?
A) Cash
B) Check
C) Direct Deposit
D) Paycard
Answer: D
Bloom's: Analyze
61) The annual payroll tax guide that the IRS distributes is called ________.
A) The IRS tax guide
B) Publication E
C) Circular 15
D) Publication 15
Answer: D
Difficulty: 1 Easy
Bloom's: Remember
54
62) When a payroll check is subject to escheatment, who handles the distribution of the money?
A) The employee.
B) The company.
C) The IRS.
D) It depends on state laws.
Answer: D
Bloom's: Apply
63) Nickels Company is located in West Virginia has employees who live in Ohio, Florida,
Tennessee, and West Virginia. For which state(s) should the company collect and remit state
income tax? (You may select more than one answer.)
A. Florida
B. Tennessee
C. Ohio
D. West Virginia
Answer: C, D
Bloom's: Apply
64) The factors that determine an employee's federal income tax are ________.
A) Marital status, birth date, taxable pay, and pay frequency
B) Number of children, pay frequency, marital status, and gross pay
C) Marital status, number of withholdings, taxable pay, and pay frequency
D) Pay frequency, number of dependents, taxable pay, and marital status
Answer: C
Bloom's: Analyze
55
65) The percentage method of determining an employee's Federal income tax deductions
________.
A) is used to promote complexity in payroll practices
B) allows payroll accountants to determine Federal income tax for the firm itself
C) is used primarily for high wage earners and computerized payroll programs
D) is less accurate than the results gained from using the wage-bracket method
Answer: C
Bloom's: Evaluate
66) The purpose of the wage base used for the Social Security tax is ________.
A) to determine when to start withholding the tax from an employee's pay
B) to establish a maximum salary level for application of the tax to employee pay
C) to determine the amount of Social Security tax to withhold from an employee's pay
D) to compute the total amount of Social Security tax that a firm must pay
Answer: B
Difficulty: 3 Hard
Bloom's: Evaluate
67) The percentage of the Medicare tax withholding ________.

A) is the same for every employee, regardless of income
B) is subject to change based on the firm's profitability
C) changes every year in response to industry needs
D) remains the same for all employees who earn less than $200,000
Answer: D
Difficulty: 1 Easy
Bloom's: Understand
56
68) State and Local Income Tax rates ________.
A) exist at the same level in every state
B) differ among states and localities
C) are mandated by Federal law
D) are paid by the employer to the Federal government
Answer: B
Difficulty: 1 Easy
Bloom's: Understand
69) Post-Tax Deductions are amounts ________.

A) That are voluntarily chosen by the employee
B) That the employer chooses to withhold after assessing the employee's tax liability
C) That Include both mandatory and voluntary deductions
D) That are only mandatory deductions like garnishments and union dues
Answer: C
Difficulty: 1 Easy
Bloom's: Understand
70) The purpose of paycards as a pay method is to ________.

A) prevent employees from opening bank accounts
B) promote accessibility and portability of employee compensation
C) protect payroll processes against embezzlement
D) promote debit card use as a means of economic stimulus
Answer: B
Difficulty: 3 Hard
Bloom's: Evaluate
57

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Landin Test Bank

9) Charitable contributions are an example of post-tax voluntary deductions.

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Table 5. Percentage Method-2018 Amount for one Withholding Allowance

Payroll Period One Withholding

Percentage Method Tables for Income Tax Withholding

Table 5. Percentage Method-2018 Amount for one Withholding Allowance

Payroll Period One Withholding

TABLE 2-BIWEEKLY Payroll Period

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Wage Bracket Method Tables for Income Tax Withholding

Table 5. Percentage Method-2018 Amount for one Withholding Allowance

TABLE 3-SEMIMONTHLY Payroll Period

Table 5. Percentage Method-2018 Amount for one Withholding Allowance

Payroll Period One Withholding

TABLE 2-BIWEEKLY Payroll Period

Table 5. Percentage Method-2018 Amount for one Withholding Allowance

Federal Income tax using percentage method

Payroll Period One Withholding

TABLE 3-SEMIMONTHLY Payroll Period

Wage Bracket Method Tables for Income Tax Withholding

54) Why do employers use checks as an employment payment method?

67) The percentage of the Medicare tax withholding ________.

69) Post-Tax Deductions are amounts ________.

70) The purpose of paycards as a pay method is to ________.

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