Fundamentals of Financial Accounting 4th Edition by Fred Phillips,Robert Libby,Patricia Libby

Exercise 7

As of February 28, 2012, American Greetings Corporation had 7,400 full-time and 17,400 part-time employees. Assume that in the last pay period of the year, the company paid $8,000,000 to employees after deducting $2,000,000 for employee income taxes, $612,000 for FICA taxes, and $700,000 for other purposes. No payments have been made to the government relating to these taxes. Which of the following statements is true regarding this pay period
A) FICA Taxes Payable should be $612,000.
B) FICA Taxes Payable should be $1,224,000.
C) Salaries and Wages Expense should be $8,000,000.
D) None of the above is true.