Payroll - Curt Holman 

Outlines/Check Figures

Quarter:        Summer 2004
 

Instructor:    Curt Holman
 

Class Schedule:    M-F (8:00 – 10:00); H311
    

Telephone:    425-235-2352 (ext. 5585)

E-mail:        cholman@rtc.ctc.edu

Web Site:    http://www.rtc.edu/instruction/Accounting/welcome_page.htm 

Office Hours:    Room H308 (7:30A-8:00A; 2:30P-3:00P)

Text:    Payroll Accounting, 2004 Edition, Bernard J. Bieg

Other Materials:    Eraser(s)

OBJECTIVE:    The student will learn to calculate wages, FICA taxes, FIT withholdings, and FUTA/SUTA taxes. In addition, the student will become familiar with the provisions of the major laws and learn to complete the 940 and 941 Forms, the SUTA Form for Washington, and Form 8109.

MAKEUP POLICY: 

    Missed Assignments -    only under special circumstances. Not automatically permitted. 

        50% minimum late fee (score reduction before you begin) if submitted by exam date

    Missed Exams -   “yes” under special circumstances. 

        Must be taken on first day back to class to avoid additional late fees.

        10% minimum late fee (score reduction before you begin)

    Make-up Exams - the general rul is "no"; I want you to focus on the future, not the past.

        20% minimum retake fee (score reduction before you begin)

MISSING TIME: It is a student's responsibility to find out from other students what information or assignments were "missed" and if necessary to create a "catch up" plan. Missed time, for attendance purposes, cannot be made up. 

TIMELINESS:    Being on time is important on the job and in this class. Not only is tardiness disruptive to the classroom, the skills and habits you develop now will directly affect your future employability. The two most commonly asked questions by potential employers concern attendance and attitude!

CLASSROOM BEHAVIOR:    As much as possible, you will be treated as though you are an employee; therefore, our expectations are that you conduct yourself in a professional manner. Examples of inappropriate (unprofessional) and unacceptable behavior include: talking during presentations, tardiness, putting your head down on the desk, putting your feet up on tables,  sleeping, use of foul language, working on non-class assignments, e-mailing, surfing the internet, and not being attentive.

OTHER: Food or drink – not allowed per campus policy
    Cell phones and beepers – turn off please
    Classroom phones – for official campus employee business
    Copier Use – for official campus employee business
    Emergencies – use campus pay phones
    Smoking - Allowed only in clearly displayed designated areas   

Course Competencies - Payroll

1.     Identify the various payroll laws, record-keeping requirements affecting employers in accordance with GAAP.

2.     Computer the regular and overtime pay for employees using various methods and pay periods in accordance with the Fair Labor Standards Act and GAAP.

3.     Compute employee and employer share of FICA. Prepare a form 941 in accordance with GAAP.

4.     Compute income tax withholding for Regular and Supplemental pay using both the Wage Bracket and percentage Methods in accordance with GAAP.

5.     Computer the Federal Unemployment Tax (FUTA) under a variety of situations and prepare the employer’s form 941 in accordance with GAAP.

6.     Complete a payroll register and employee’s earning record and prepare all required journal entries for a payroll period in accordance with GAAP.

7.     Perform all necessary payroll procedures for a one-month pay period and prepare all required payroll reports in accordance with GAAP.

Grading - Payroll

The following standards are used for this class:

Calendar - Payroll

Homework/Exam Dates - Payroll

Glossary

1. Annualizing payroll - calculating withholding taxes for one period by determining withholding taxes on annualized payroll and dividing by number of pay periods.

2. Biweekly - every two weeks

3. Check-off system - withholding union dues from employees' wages

4. Commission - percentage of sales paid to an employee

5. Common-law relationship - employer has right to control what and how work is done.

6. Dismissal payments - separation pay, paid to workers separated from employment.

7. Disposable earnings - amount of check remaining after taxes.

8. Domestic service - service performed in a private home.

9. Earned income credit - FIT reduction for some workers with dependent children.

10. Educational assistance - employer pays for some cost of an employee's education.

11. Electronic funds transfer - employer transfers employee's net pay without issuing a paycheck.

12. Employee - an individual in an employee/employer relationship who performs services. 

13. Employee history record - record of the historical relationship of an employee.

14. Employee earnings record - record of complete earnings of each employee, used for W-2 preparation.

15. Employer - any person or organization who employs at least one employee.

16. Employment - service performed by employee for employer.

17. Enterprise coverage - used to determine FLSA coverage for employers with two or more employees and gross annual sales of at least $500,000.

18. Exempt employee - worker for whom some or all FLSA requirements do not apply.

19. Experience rating - also called merit rating, SUTA rates determined in part by benefits paid.

20. Form W-2 - employer yearly report of earnings and some deductions.

21. Form W-4 - employee withholding allowance certificate.

22. Form W-5 - earned income credit advanced payment certificate.

23. 401(k) plan - method to to defer federal income taxes.

24. Garnishment - portion of wages required to be legally withheld to pay a debt.

25. Gross earnings - total earnings before taxes and other deductions.

26. Group insurance - employee life insurance at a low cost.

27. Hiring notice - form sent to payroll department so an employee can be added to payroll.

28. Hospital insurance plan - HI part of FICA taxes, also called Medicare.

29. Income tax - tax on most employees earnings deducted from gross pay.

30. Independent contractor - a person who performs a service that is offered to the public.

31. Individual employee coverage - used to determine FLSA coverage for an individual who engages in or produces goods for interstate commerce. 

32. Individual retirement account - employee pension plan established by and funded by an individual.

33. Interstate employee - employee who works in more than one state.

34. Lookback period - 4 consecutive quarters beginning July1st two years ago and ending June 30th of the previous year.

35. Monthly depositor - new company or one that reported at least $50,000 of employment taxes in the lookback period.

36. Negative-balance employer - reserve balance has had more benefits paid out than taxes paid in.

37. Payroll register - form that list all employees earnings, deductions, and net pay.

38. Percentage method - method to calculate FIT withholding from paychecks.

39. Personal Allowance - a deduction allowed in computing taxable income, also called a personal allowance.

40. Piece-rate system - workers paid according to how much they produce.

41. Positive-balance employer - reserve balance has had more taxes paid in than benefits paid out.

42. Principal activities - tasks that must be performed for the employer.

43. Profit-sharing plan - employer shares part of the company profits with employees.

44. Quarterly averaging - calculating withholding taxes for one period by estimating average wages for each period in a quarter.

45. Reciprocal arrangements - agreement between states to provide unemployment insurance and payment of taxes by only one state.

46. Reserve-ratio formula - contribution less benefits (reserve balance) / average payroll. 

47. Salary - earnings paid on a weekly, monthly, biweekly, semimonthly or yearly basis. 

48. Self-employment income - net earnings of an individual from owing a sole proprietorship or partnership..

49. Semimonthly - twice a month.

50. Semiweekly depositor - business reported more than $50,000 of employment in lookback period. 

51. Sick pay - payment made to individual because of injury or sickness.

52. Simplified employee pension (SEP) plan - formal retirement account for which the employer makes contributions on behalf of employees.

53. Social security benefits - payments are made to retired workers, spouses, children, parents, widows, widowers.

54. Standard deduction - amount used to reduce individual's adjusted gross income.

55. Supplemental wage payments - additional pay such as vacation pay, bonuses, and commissions.

56. Taxable wage base - maximum amounts taxable for a particular tax.

57. Time card - form to record time worked, time sheet is often referred to as the same thing.

58. Time sheet - form to record arrival time and departure time, time card is often referred to as the same thing

59. Tip - extra amount given by a customer for services performed. 

60. Tipped employee - one who customarily and regularly receives tips of more than $30 a month.

61. Unemployment compensation benefits - payments made to temporarily unemployed workers.

62. Unemployment insurance - program to provide unemployment compensation benefits to those qualified, FUTA (federal), SUTA (state).

63. Unemployment insurance taxes - the source of the funds to pay form unemployment compensation benefits.

64. Vesting - an employee's right to share in a retirement fund when terminated before the normal retirement age.

65. Voluntary contributions - extra payments made by employers to increase their reserve balance.

66. Wage-bracket method - method to determine FIT withholding by looking at an IRS supplied table.

67. Wages - total compensation (cash and non-cash) paid to an employee.

68. Workers' compensation insurance - protection provided to employees in case of injury or death during employment.

69. Workweek - 7 consecutive 24 hour periods.

Help (Payroll)