Also, I have a lot of trouble with payroll taxes, any advice?
Lime Co.'s payroll for the month ending January 31, 20X1, is summarized as follows:
Total wages $10,000
Federal income tax withheld 1,200
All wages paid were subject to the Federal Insurance Contributions Act (FICA). FICA tax rates were 7.65% each for employee and employer. Lime remits payroll taxes on the 15th of the following month. In its financial statements for the month ending January 31, 20X1, what amounts should Lime report as total payroll tax liability and as payroll tax expense?
Select an answer:
A.
Liability: $1,200; Expense: $1,530
B.
Liability: $1,965; Expense: $1,530
C.
Liability: $1,965; Expense: $765
D.
Liability: $2,730; Expense: $765