CPP CPP Payroll Accounting & Reporting

Question 1

Which journal entry correctly records the employer's share of Social Security tax?

Accepted Answer

Debit Payroll Tax Expense, Credit FICA Taxes Payable

Answer

The employer's share of Social Security tax is recorded by debiting Payroll Tax Expense and crediting FICA Taxes Payable.

Question 2

What is the primary purpose of a payroll register?

Accepted Answer

To serve as the source document for payroll journal entries

Answer

The payroll register summarizes all payroll data for a pay period and serves as the primary source for recording journal entries.

Question 3

When recording gross wages, the offsetting credits typically go to:

Accepted Answer

Cash and various withholding liability accounts

Answer

Gross wages are debited to Wages Expense while credits go to cash (net pay) and various withholding liability accounts.

Question 4

Form W-3 is submitted to which agency along with Copy A of all W-2 forms?

Accepted Answer

The Social Security Administration

Answer

Form W-3 transmits all Copy A W-2 forms to the Social Security Administration by January 31.

Question 5

A payroll bank account reconciliation primarily verifies that:

Accepted Answer

Checks issued match the bank statement debits

Answer

Payroll bank reconciliation matches issued payroll checks against bank statement debits to detect errors or fraud.

CPP - Certified Payroll Professional Practice Test