The entry to record the payroll tax expenses would include
A) a credit to Federal Income Taxes Expense.
B) a credit to EI Payable and CPP Payable.
C) a credit to Taxes Payable.
D) a credit to Wages Payable.

Question

Quizplus · Accepted Answer

The payroll tax expenses include Employment Insurance (EI) and Canada Pension Plan (CPP) contributions made by both the employee and employer. Therefore, the entry would include a credit to EI Payable and CPP Payable accounts. There is no specific account called Federal Income Taxes Expense, Taxes Payable could be used for other types of taxes, and Wages Payable is a liability account for unpaid employee wages.

The Entry to Record the Payroll Tax Expenses Would Include