Question

1. Which of these does NOT represent a decrease in net cash received on an employee's paycheck?a. gross wagesb. Medicare taxesc. social security taxesd. federal withholding taxes2. Year-to-date summaries on a paycheck stub are similar to the wayA. expenses and revenues are transferred to an income summary.B. adjusting entries are recorded in the journal.C. income statement accounts accumulate revenues and expenses over a period.D. none of these3. When are the balances of temporary accounts set to zero?

A. at the end of each week
B. at the end of each pay period
C. at the end of the year
D. at the end of the employee's employment with the company

Answer 1

1) A: Gross wages do not represent a decrease in net cash received on an employees paycheck. The gross wage s what the employee would have earned if no deductions were made.

2) C: Year to date summaries on a paycheck stub accumulate salaries and deductions in the same way an income statement accumulates revenues and expenses over a period.

3) B: At the end of each accounting period temporary accounts have to be set to zero. Their balances are transferred to permanent accounts.