Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

9. Current Liabilities

Payroll and Payroll Taxes

Financial Accounting

9. Current Liabilities

Payroll and Payroll Taxes

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Multiple Choice

Which of the following is a payroll tax normally paid by both the employee and the employer?

Federal income tax

Federal unemployment tax (FUTA)

State unemployment tax (SUTA)

Social Security tax (FICA)

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Verified step by step guidance

Understand the concept of payroll taxes: Payroll taxes are taxes imposed on employers and employees, and they are typically calculated as a percentage of the wages paid to employees. Some payroll taxes are paid solely by the employer, while others are shared between the employer and the employee.

Review the types of payroll taxes listed in the problem: Federal income tax, Federal unemployment tax (FUTA), State unemployment tax (SUTA), and Social Security tax (FICA). Each of these taxes has specific rules regarding who is responsible for payment.

Clarify the responsibility for Federal income tax: Federal income tax is withheld from the employee's paycheck and paid to the government by the employer on behalf of the employee. However, it is not shared between the employer and employee; it is solely the employee's responsibility.

Clarify the responsibility for FUTA and SUTA: Federal unemployment tax (FUTA) and State unemployment tax (SUTA) are paid entirely by the employer to fund unemployment benefits. These taxes are not shared with the employee.

Explain Social Security tax (FICA): Social Security tax, part of the Federal Insurance Contributions Act (FICA), is a payroll tax that is shared between the employer and the employee. Both parties contribute an equal percentage of the employee's wages to fund Social Security benefits.