Test Your Knowledge - Payroll Accounting

What is the primary purpose of payroll accounting?

To calculate employee salaries and wages
To track the company's revenue
To prepare financial statements

What is the purpose of deductions in payroll accounting?

To reduce the employer's expenses
To withhold taxes and other required contributions
To increase employee earnings

What is the difference between gross pay and net pay?

Gross pay is the total amount before deductions; net pay is after deductions
Gross pay includes overtime; net pay excludes overtime
Gross pay includes bonuses; net pay does not

Which of the following is an example of a payroll deduction?

Employee salary
Employee health insurance premiums
Employer’s contribution to pension

Which of the following taxes is typically withheld from an employee's paycheck?

Corporate income tax
Payroll tax
Property tax

What is the role of an employer in payroll accounting?

To calculate, deduct, and report employee taxes
To prepare the financial statements for the company
To create employee contracts

What is an example of a payroll tax?

Unemployment tax
Sales tax
Income tax

What does the term "payroll register" refer to?

A document that lists employees' wages and deductions
A report of the company's total earnings
A report of the company's tax payments

What is the importance of accurate payroll accounting?

To ensure compliance with tax laws and regulations
To calculate the company’s profitability
To generate the company’s annual financial statements

What is an employee's net pay?

The amount after deductions
The total amount of an employee’s earnings
The amount before any deductions

Test Your Knowledge - You have 10 questions!