1. LESSON 12-1 Preparing Payroll Time Cards
4/24/2017
LESSON 13-1
Preparing Payroll Time Cards

2. TERMS REVIEW
salary
pay period
payroll
total earnings
LESSON

3. ANALYZING A PAYROLL TIME CARD
LESSON 13

4. CALCULATING EMPLOYEE HOURS WORKED
1. Calculate the number of regular hours for each day and enter the amounts. 1
2. Calculate the number of overtime hours and enter the amounts.
3. Add Hours Reg and Hours OT columns and enter the totals. 2
4. Add the Hours column. 3 4
LESSON 13

5. CALCULATING EMPLOYEE TOTAL EARNINGS
1. Enter the rate for regular time in the Rate column.
2. Calculate the regular earnings. Enter the amount.
3. Enter the rate for overtime.
4. Calculate the overtime earnings. Enter the amount.
5. Add the Amount column to calculate total earnings. Enter the amount of total earnings. 1 2 4 3 5
LESSON 13

6. Audit Understanding What is a payroll?
How many hours were worked by an employee who arrived at 8:29 and departed at 12:02?
How does Omni calculate overtime earning?
What are the total earnings of an employee who worked 40 hours and earned $11.00 per hour?
LESSON 12-1

7. LESSON 12-1 Determining Payroll Tax Withholding
4/24/2017
LESSON 13-2
Determining Payroll Tax Withholding

8. TERMS REVIEW payroll taxes withholding allowance social security tax
Medicare tax
tax base
LESSON 13

9. LESSON 13-2 Payroll Taxes – Taxes based on the payroll of a business.
4/24/2017
LESSON 13-2
Payroll Taxes – Taxes based on the payroll of a business.
Required by law to withhold certain payroll taxes
Payroll taxes withheld are a liability for the company until payment is made to the government

10. LESSON 12-1
4/24/2017
LESSON 13-2
Employee Income Tax – A business must withhold federal income taxes from employee total earnings
Federal Income taxes withheld must be sent to the federal government periodically
Most states withhold state income tax
Some states withhold city or country income taxes as well

11. EMPLOYEE’S WITHHOLDING ALLOWANCE CERTIFICATE3 2 1 4 5
1. Write the employee’s name and address
2. Write the employee’s social security number.
3. Check the appropriate marital status block.
4. Write the total number of withholding allowances claimed.
5. The employee signs and dates the form.
LESSON 13

12. EMPLOYEE’S INCOME TAX WITHHOLDING – MARRIED PERSONS1 2 3
1. Select the appropriate table.
2. Locate the employee’s total earnings.
3. Intersection of wages and number of allowances column.
LESSON 13

13. Employee SS and MD Tax Social Security & Medicare tax
FICA – Federal Insurance Contributions Act provides for a federal system of old-age, survivors, disability, and hospital insurance.
Social Security (SS) – For old age, survivors and disability
Medicare (MD) – for hospital insurance
FICA taxes are paid by EMPLOYEES and EMPLOYERS
SS is calculated on employee earnings up to a maximum paid in calendar year. The Maximum amount is called the TAX BASE.
The rate used for SS is 6.2% or the factor of .062.
Medicare has no tax base (No maximum earnings)
The rate used for MD is 1.45% or the factor of .0145
LESSON 13

14. Audit Your Understanding
Where does an employer get the information used to determine the amount of federal income tax to withhold from employees’ earning?
Employee federal income tax withholdings are based on what two factors?
Does the employer or employee pay social security tax and Medicare tax?
LESSON 12-1

15. LESSON 12-1 Preparing Payroll Records
4/24/2017
LESSON 13-3
Preparing Payroll Records

16. TERMS REVIEW payroll register net pay employee earnings record
page 355
payroll register
net pay
employee earnings record
LESSON 12-1

17. LESSON 12-1
4/24/2017
LESSON 13-3
Payroll Register – A business form used to record and summarize payroll information.
Gross Pay – Total Earnings with no deductions
Deductions – Amount withheld from pay for taxes, insurance or investment.
Net Pay – Total earnings paid to an employee AFTER all deductions have been subtracted.

18. PAYROLL REGISTER 1. Pay period date2 11 4 5 6 7 8 9 10 3 13 12
1. Pay period date
8. Health insurance premium deductions
2. Payment date
9. Other employee payroll deductions
3. Employee personal data
10. Total deductions
4. Earnings
11. Net pay
5. Federal income tax withheld
12. Total, prove, and rule
6. Social security tax withheld
13. Check number
7. Medicare tax withheld
LESSON 13

19. LESSON 12-1
4/24/2017
LESSON 12-3
Employee Earnings Record – A business form used to record details affecting make to an employee.

20. EMPLOYEE EARNINGS RECORDS
page 353
1. Last day of quarter 4
2. Employee personal data 5
3. Beginning accumulated earnings 1 2
4. Pay period 3
5. Earnings, deductions, net pay 6
6. Updated accumulated earnings 7
7. Total and prove
LESSON 12-1

21. Audit Your Understanding
What does the payroll register summarize?
How is net pay calculated?
Why do companies complete employee earnings records?
LESSON 12-1

22. LESSON 12-1 Preparing Payroll Checks
4/24/2017
LESSON 13-4
Preparing Payroll Checks

23. LESSON 13-4 Payroll Bank Account
4/24/2017
LESSON 13-4
Payroll Bank Account
A check for total net pay is written on Company’s general checking Account to the Company’s Payroll checking account

24. PAYROLL BANK ACCOUNT 1 2 1. Prepare the check stub.
LESSON 13

25. LESSON 13-4 Employee’s Payroll Check
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LESSON 13-4
Employee’s Payroll Check
Information for check is taken from the payroll register. The check will have a detachable “stub” with detailed information on employee earnings and amounts deducted.

26. EMPLOYEE’S PAYROLL CHECK1 2
1. Prepare the check stub of each employee’s payroll check.
2. Prepare each employee’s payroll check.
LESSON 13

27. LESSON 13-4 Electronic Funds Transfer (EFT)
4/24/2017
LESSON 13-4
Electronic Funds Transfer (EFT)
Computerized cash payments system that transfers funds without the use of checks, currency or other paper documents
The business deposits the net earnings into the employee’s bank account electronically.
The employee receives a statement of earnings and deductions similar to a check “stub”.

28. Audit Your Understanding
Why does Omni Import have a separate checking account for payroll checks?
What is the source of the information that is recorded on each employee’s payroll check stub?
How do payroll procedures differ for an employee who requests that her pay be deposited through electronic funds transfer?
LESSON 12-1