Chapter 13 Outline

Terms Preview

• Salary-The money paid for employee.
• Pay period-The period covered by a salary payment.
• Payroll-The total amount earned by all employees for a pay period.
• Total Earnings-The total pay due for a pay period before deductions.
• Payroll Taxes-Taxes based on the payroll of a business.
• Withholding Allowance-An deduction from total earnings for each person legally supported by taxpayer, including the employee.
• Social Security Tax-A federal tax paid for old-age, survivors, and disability insurance.
• Medicare Tax-A federal tax paid for hospital insurance.
• Tax Base-The maximum amount of earnings on which a tax is calculated.
• Payroll Register-A business form used to record payroll information.
• Net Pay-The total earnings paid to an employee after payroll taxes and other deductions.
• Employee Earnings Record-A business form used to record details affecting payments made to an employee.

Preparing an Employee's withholding Allowance Certificate

1. Write the employee's name and address.
2. Writen the employee's social security number.
3. Check appropiate marital status block.
4. Write the total number of withholding allowances claimed.
5. Employee signs and dates.

Preparing a payroll register

1. Enter the last date of the semimonthly payroll period.
2. enter the date of payment.
3. For each employee, enter employee number, name, marital status, and number allowances.
4. Enter regular earnings, overtime earnings, and total earnings for each employee in columns of the payroll register.
5. Enter in column the federal income tax witheld from each employee.