Practice Test Geeks(CPM) Certified Payroll Manager Practice Test
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Payroll Accounting and Reporting Flashcards

7 cards from real CPM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Payroll Accounting and Reporting flashcards as text

  1. Which account is credited when recording an employee's gross wages as a payroll expense?

    Answer: Salaries Payable

    When accruing payroll, Salaries Expense is debited and Salaries Payable (a liability) is credited until payment is made.

  2. On a payroll journal entry, which of the following represents the employer's share of FICA taxes?

    Answer: A debit to Payroll Tax Expense and credit to FICA Taxes Payable

    The employer's share of FICA is recorded as Payroll Tax Expense (debit) and FICA Taxes Payable (credit), separate from employee withholdings.

  3. What is the purpose of a payroll subsidiary ledger?

    Answer: To maintain detailed individual employee earnings records that support the general ledger payroll accounts

    A payroll subsidiary ledger contains individual employee earning histories that provide the detail behind the summarized general ledger balances.

  4. An employer pays wages of $10,000 and withholds $765 in employee FICA and $1,500 in federal income tax. What is the correct credit to Cash when the net payroll is disbursed?

    Answer: $7,735

    $10,000 gross minus $765 FICA minus $1,500 FIT withholding equals $7,735 net pay disbursed in cash.

  5. Which payroll report is used to reconcile total wages paid to employees against amounts reported to the IRS on Form 941?

    Answer: Payroll Register

    The payroll register is an internal report summarizing each pay period's payroll data that employers use to reconcile totals to Form 941 filings.

  6. Which of the following correctly describes the accrual of vacation pay under GAAP?

    Answer: Vacation pay must be accrued as it is earned if it is probable and estimable

    GAAP requires accrual of compensated absences such as vacation pay when the obligation is probable and the amount can be reasonably estimated.

  7. A company's Form 941 for Q1 shows $50,000 in wages and $7,650 in total FICA taxes. The payroll register shows the same amounts. What does this reconciliation confirm?

    Answer: The payroll register supports the amounts reported on Form 941

    When the payroll register totals match Form 941 reported wages and taxes, it confirms the internal records support the amounts filed with the IRS.