PAYROLL ACCOUNTING SOLUTION MANUAL
FINAL SCRIPT 2026 COMPLETE QUESTIONS
AND ANSWERS ALREADY PASSED
◉ Payroll Effects on the Accounting System Answer: Payroll reflects
a business expense
Reduces profitability in proportion to wages paid
Payroll expenses must be allocated to correct accounts and
departments
Bulk of accountant's work is considered a business overhead cost
Not traceable to a single department
◉ Accounting Reports Answer: Income Statement
- Shows revenue and expenses of the firm
Balance Sheet
- Shows balance of all asset, liability, and owners' equity accounts at
a specific time
Trial Balance
- Proves that Debits and Credits are equal
, ◉ Labor Report Answer: - Designated to inform managers and
department heads
- Shows where the labor is used within the company
- Fosters allocation of labor expenses
- Allows firm to bill time to customers accurately
- Provides for analysis of employee efficiency and payroll trends
◉ Payroll Process Flowchart Answer: Does your company have
employees?
Is it payday?
Do you know much each employee should be paid?
Do you have managerial approval for all employee pay for the
period?
Have you computed their payroll taxes properly?
Have you computed their voluntary deductions?
Have you included any other mandatory deductions?
Have you completed the payroll register?
Have you obtained approval for pay disbursements?
Do you know what pay method each employee needs?
Have you disbursed the employees' pay?
Did you journalize and post the employees' payroll transaction?
Did you update the employees' earning records?
FINAL SCRIPT 2026 COMPLETE QUESTIONS
AND ANSWERS ALREADY PASSED
◉ Payroll Effects on the Accounting System Answer: Payroll reflects
a business expense
Reduces profitability in proportion to wages paid
Payroll expenses must be allocated to correct accounts and
departments
Bulk of accountant's work is considered a business overhead cost
Not traceable to a single department
◉ Accounting Reports Answer: Income Statement
- Shows revenue and expenses of the firm
Balance Sheet
- Shows balance of all asset, liability, and owners' equity accounts at
a specific time
Trial Balance
- Proves that Debits and Credits are equal
, ◉ Labor Report Answer: - Designated to inform managers and
department heads
- Shows where the labor is used within the company
- Fosters allocation of labor expenses
- Allows firm to bill time to customers accurately
- Provides for analysis of employee efficiency and payroll trends
◉ Payroll Process Flowchart Answer: Does your company have
employees?
Is it payday?
Do you know much each employee should be paid?
Do you have managerial approval for all employee pay for the
period?
Have you computed their payroll taxes properly?
Have you computed their voluntary deductions?
Have you included any other mandatory deductions?
Have you completed the payroll register?
Have you obtained approval for pay disbursements?
Do you know what pay method each employee needs?
Have you disbursed the employees' pay?
Did you journalize and post the employees' payroll transaction?
Did you update the employees' earning records?
