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 major payroll tax that employers are required to withhold from employees' wages?

Property tax

Federal Insurance Contributions Act (FICA) tax

Sales tax

Excise tax

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Verified step by step guidance

Understand the concept of payroll taxes: Payroll taxes are taxes imposed on employers and employees, typically calculated as a percentage of the wages paid to employees. These taxes fund social programs such as Social Security and Medicare.

Identify the major payroll tax: Employers are required to withhold specific taxes from employees' wages. One of the most significant payroll taxes is the Federal Insurance Contributions Act (FICA) tax, which includes Social Security and Medicare contributions.

Differentiate payroll taxes from other types of taxes: Property tax, sales tax, and excise tax are not payroll taxes. Property tax is levied on real estate, sales tax is applied to goods and services, and excise tax is imposed on specific goods like alcohol or tobacco.

Recognize the employer's responsibility: Employers must calculate and withhold FICA taxes from employees' wages and also contribute an equal amount to these programs on behalf of the employees.

Conclude the correct answer: Based on the explanation, the major payroll tax that employers are required to withhold from employees' wages is the Federal Insurance Contributions Act (FICA) tax.