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ACCA Knowledge Level Payroll Liabilities — practice questions

Explore 4 free Payroll Liabilities questions in ACCA Knowledge Level Financial Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Payroll Liabilities questions and exercises with answers

Showing questions 1–4 of 4.

An employee paid weekly earns an annual salary of $52,000. What is the employee's gross pay per weekly pay period?Read the answer and worked solution →An employee has monthly gross pay of $4,000. What amount of Social Security tax is withheld from this paycheck at a rate of 6.2%?Read the answer and worked solution →An employee has monthly gross pay of $4,000. What amount of Medicare tax is withheld from this paycheck at a rate of 1.45%?Read the answer and worked solution →In the entry to record an employee's pay, which account is debited for the full gross pay amount before deductions?Read the answer and worked solution →

Worked practice questions

An employee paid weekly earns an annual salary of $52,000. What is the employee's gross pay per weekly pay period?

  1. $1,000
  2. $4,333
  3. $52,000
  4. $2,000
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Correct answer: A. $1,000

1. Gross pay is total earnings before any deductions. 2. A 52-week year divides the annual salary evenly: \$52{,}000 \div 52 = \$1{,}000. 3. Weekly gross pay is $1,000. _Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §5.2 "Payroll", p.210_

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An employee has monthly gross pay of $4,000. What amount of Social Security tax is withheld from this paycheck at a rate of 6.2%?

  1. $58
  2. $620
  3. $248
  4. $306
Show answer and solution

Correct answer: C. $248

1. Social Security tax is 6.2% of gross pay. 2. Compute: \$4{,}000 \times 6.2\% = \$248. 3. (Medicare at 1.45% would be $58, a separate deduction; do not confuse the two.) 4. Social Security withheld is $248. _Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §5.2 "Payroll", p.212_

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An employee has monthly gross pay of $4,000. What amount of Medicare tax is withheld from this paycheck at a rate of 1.45%?

  1. $248
  2. $58
  3. $145
  4. $40
Show answer and solution

Correct answer: B. $58

1. Medicare tax is 1.45% of gross pay. 2. Compute: \$4{,}000 \times 1.45\% = \$58. 3. (Social Security at 6.2% would be $248, a different deduction.) 4. Medicare withheld is $58. _Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §5.2 "Payroll", p.212_

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