How should the amount of federal income tax that is withheld from employees' paychecks by the employer be recorded?
A) On the employer's books as revenue.
B) On the employer's books as a current liability.
C) On the employer's books as an asset.
D) It should not be recorded on the employer's books.

Question

Quizplus · Accepted Answer

Federal income tax that is withheld from employees' paychecks by the employer is considered a current liability as the employer is responsible for remitting the funds to the government on behalf of the employees. It is not recorded as revenue for the employer's books.

How Should the Amount of Federal Income Tax That Is