Submitted by: Cindy Barnes
Date: 1/7 Then monthly thereafter
Subject: Advance Business II
Total Periods: Included in Financial Reporting points
Grade Level(s): 11 & 12
Each company must make ongoing monthly tax payments. The VirtuBank has established
Virtual IRS and Virtual Franchise Tax Board accounts that must be used to make
company and individual payments. Each company must research tax laws and establish
Objectives (Design): Arizona Content Standards
Pay Company Taxes (sales, income, and 25.0 Discuss Legal Concepts that Apply
corporate) according to IRS schedule. to Business 25.6
Develop payroll procedures. 32.0 Use Accounting Information to
Determine their federal and state corporate make Business Decisions 32.6,32.7
taxes and other taxes that may apply.
Materials and Resources (Development)
Computers with Internet access and Excel installed.
Procedures (Development & Implementation):
Company balance sheets should reflect that the various tax payments have been made on
time. This task needs to be completed, on an ongoing basis, throughout the final two
quarters of the simulation.
1. Each company and employee must make payments directly to the Virtual IRS and
the Virtual Franchise Tax Board in the VirtuBank.
2. Go to http://www.paycheckcity.com/netpaycalc/netpaycalculator.asp where the
employees can create and print their own W-4 form.
3. Once you have all of the employees W-4 the banker can calculate the withholding
from the employees paycheck.
4. It is best to create a spreadsheet of all the employees and their withholdings.
5. Review the attached payroll workflows that are attached or on the VE website.
6. Utilize the Banker Manual from the coordinator and/or the VE website.
Accounting/financial will go to the VE web site click on curriculum/workflows and find
income statements and payroll. Mark your calendar to be prepared.
The Financial Reporting Rubric will be used for assessing company accounting practices
Recommended Department(s) Responsible:
Keep accurate payroll records on each employee. Keep accurate payroll records for VE
company, both employee and company payroll taxes.
Quarter 1: Steps 1 - 8 should be completed before the company is officially open for business.
Quarters 2 thru 4: Steps 9 - 13 should be completed every month, November through April
and/or May. Five-hour companies may postpone paying employees until December or January.
Steps to Complete:
Modify the following procedures, as needed, depending on the type of product or service that
your company offers.
Step 1: Run W-4 Forms from IRS website. Hand out to each employee to complete.
Step 2: Review with employees number of allowable deductions on W-4 Form.
Step 3: Collect forms from employees and file in company Financial folders.
Step 4: Determine employees' yearly salaries, along with Accounting/Finance Vice President
and CEO/President. Also, determine monthly, weekly, daily, and hourly pay.
Step 5: Determine sales employees' commission, along with Accounting/Finance Vice
President and CEO/President, if applicable.
Step 6: Determine specific employee monthly payroll deductions: Federal Withholding (Income
Tax), Social Security (F.I.C.A.), Medicare, State Withholding, and State Disability. May be
determined by accounting software program, such as Quick Book Pro; or may be determined
by using a variety of websites, such as www.irs.gov, www.ftb.ca.gov, and/or
www.virtualenterprise.org (Accounting Curriculum/Payroll Lesson). Place in company Financial
folders and employees' Personal Financial folders.
Step 7: Determine specific company payroll deductions per employee: Federal Unemployment
Tax (FUTA), Social Security (F.I.C.A.), Medicare, State Unemployment Insurance (SUTA),
State Disability Insurance (CSDI), and State Workman’s Compensation. May be determined by
accounting software program, such as Quick Books Pro, or may be determined by using a
variety of websites, such as www.irs.gov, www.ftb.ca.gov, and/or www.virtualenterprise.org
(Accounting Curriculum/Payroll Lesson). Place in company Financial folders.
Step 8: Decide upon dates for paying employees: once a week, bi-monthly (1st & 15th or 15th
& 30th of each monthly), or monthly. Decide upon date (s) to pay commissions (i.e., 1st of
Step 9: Create payroll checks for employees on day before employees are to be paid. Make
sure all employee taxes are taken out before issuing checks. Keep records of all taxes, both
employee and company, to be paid to VirtuIRS and VirtuFranchise Tax Board by the company.
Step 10: Sign payroll checks and hand out to employees.
Step 11: Give payroll tax information to Accounts Payable within the first week of the month
after payroll dispersed. For example, payroll taxes for November will actually be paid in
Step 12: Follow up with Banker to make sure the employees have deposited their payroll
checks and Banker has paid each employee from the COMPANY ACCOUNT by the end of
Step 13: Follow up with Banker to make sure that the employee and company PAYROLL
TAXES for the previous month have been paid by the 10th of each month. For example,
November's payroll taxes paid by December 10th.