Vocab 1
A fixed amount of money paid to an employee for each pay period
Salary
A specific amount of money paid per hour to an employee
Name one type of pay period
Weekly, biweekly, monthly
Inventory records are updated only after someone takes a physical count of merchandise
periodic inventory system
Gross pay - deductions
Commission
Tax that finances the federal programs that provide retirement, disability, and life insurance benefits
Social Security tax
Thanks to payroll computer software, the only information about employees that an employer has to enter at the end of each pay period is?
hours worked
An inventory system that keeps a constant, up-to-date record of merchandise on hand
Perpetual inventory system
What is the formula for hourly pay? (without overtime)
hourly rate x hours worked
An adjustment to the tax withheld from a paycheck.
Allowance
An inventory costing method in which the exact cost for each item is determined and assigned to that item
Specific identification method
Give an example of a voluntary payroll deduction
Credit union deposits, savings account, retirement, charity
An inventory costing method that assumes the first items bought are the first items sold
First-in, first-out method (FIFO)
What is the formula for overtime rate?
Hourly rate x 1.5
The various amounts that are subtracted from an employee's gross earnings.
Deductions
An act establishing the Social Security system
Federal Insurance Contribution Act (FICA)
Federal law requires that employees match the total amount deducted from employee's paychecks for this?
FICA taxes (Social Security and Medicare)
An inventory costing method that assumes the last items purchased are the first items sold
Last-in, first-out method (LIFO)
What is the formula for overtime pay?
(Hourly rate x 1.5) x overtime hours
A record that summarizes information about employee earnings and deductions for each pay period.
Payroll register
An electronic cash register linked to a centralized computer system that keeps track of sales
Point-of-sale terminal
Name one step in the payroll system
Calculating gross earnings
Calculating payroll deductions
Preparing paychecks
Preparing payroll records
What type of products would a business use the first-in, first-out method of estimating cost?
food/perishable items
What is the formula for inventory turnover?
Cost of merchandise sold / average inventory