When an employer deducts tax from an employee’s wages the amount deducted is recorded as a: Group of answer choices current liability. miscellaneous expense. not recorded because it is a tax paid for the employee. non-current liability.
Question
When an employer deducts tax from an employee’s wages the amount deducted is recorded as a: Group of answer choices
current liability.
miscellaneous expense.
not recorded because it is a tax paid for the employee.
non-current liability.
Solution
The amount deducted as tax from an employee's wages by an employer is recorded as a current liability. This is because the employer is responsible for remitting this amount to the government, making it a liability. Since this is typically done on a regular, often monthly, basis, it is considered a current (short-term) liability, not a non-current (long-term) liability. It is not a miscellaneous expense, as it is a regular and expected part of doing business. It is also not correct to say it is not recorded because it is a tax paid for the employee. Even though the tax is paid on behalf of the employee, it is still a business transaction that needs to be recorded.
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