The following totals for the month of April were taken from the payroll records of Metz Company. $$\begin{array} { l r }
\text { Salaries } & \$ 90,000 \
\text { FlCA taxes withheld } & 6,885 \
\text { Income taxes withheld } & 19,800 \
\text { Medical insurance deductions } & 3,600 \
\text { Federal unemployment taxes } & 720 \
\text { State unemployment taxes } & 4,500
\end{array}$$ The entry to record accrual of employer's payroll taxes would include a
A)debit to Payroll Tax Expense for $12,105.
B)credit to Payroll Tax Expense for $12,105.
C)credit to FICA Taxes Payable for $5,220.
D)credit to Payroll Tax Expense for $5,220.

Question

The following totals for the month of April were taken from the payroll records of Metz Company. $$\begin{array} { l r } 
\text { Salaries } & \$ 90,000 \
\text { FlCA taxes withheld } & 6,885 \
\text { Income taxes withheld } & 19,800 \
\text { Medical insurance deductions } & 3,600 \
\text { Federal unemployment taxes } & 720 \
\text { State unemployment taxes } & 4,500
\end{array}$$ The entry to record accrual of employer's payroll taxes would include a
A)debit to Payroll Tax Expense for $12,105.
B)credit to Payroll Tax Expense for $12,105.
C)credit to FICA Taxes Payable for $5,220.
D)credit to Payroll Tax Expense for $5,220.

Quizplus · Accepted Answer

The entry to record accrual of employer's payroll taxes would include a debit to Payroll Tax Expense for $12,105. This is because the employer is responsible for paying both the employee and employer portions of FICA taxes and unemployment taxes. The total amount of employer payroll taxes is $12,105 ($6,885 + $720 + $4,500).

The Following Totals for the Month of April Were Taken