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 considered a payroll cost for employers?

Employee's contribution to a 401(k) plan

Employee's share of health insurance premiums

Employer's share of Social Security and Medicare taxes

Employee's federal income tax withholding

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Verified step by step guidance

Understand the concept of payroll costs: Payroll costs for employers include expenses that the employer is legally required to pay or chooses to pay on behalf of employees. These costs are separate from amounts deducted from employees' paychecks.

Review the components of payroll costs: Employers are responsible for paying their share of Social Security and Medicare taxes, unemployment taxes, and any employer-sponsored benefits such as health insurance or retirement contributions.

Analyze the options provided: Employee's contribution to a 401(k) plan and Employee's share of health insurance premiums are deductions from the employee's paycheck, not costs borne by the employer. Employee's federal income tax withholding is also deducted from the employee's paycheck and remitted by the employer but is not an employer cost.

Focus on the correct answer: Employer's share of Social Security and Medicare taxes is a payroll cost because it is a legal obligation for employers to match the amounts withheld from employees' paychecks for these taxes.

Conclude the reasoning: The correct answer is Employer's share of Social Security and Medicare taxes, as it represents a direct cost incurred by the employer in relation to payroll.