What is the entry related to the employer's share of Social Security tax and Medicare tax?

The correct entry related to the employer's share of Social Security tax and Medicare tax reflects the accounting treatment for these payroll liabilities. In governmental accounting, the employer is responsible for matching employee contributions to Social Security and Medicare, which are also referred to as FICA taxes (Federal Insurance Contributions Act).

In the correct entry, debiting the Expenditures Control account for 423,000 indicates that this amount is being recognized as an expenditure for the employer’s share of the payroll taxes, highlighting the government’s expense related to employee salaries. The corresponding credit to the Due to Federal Government account for 256,000 shows the portion attributable to Social Security and Medicare taxes that the government needs to remit to the federal government as a liability.

This entry accurately conveys the financial obligation that the government has incurred through its payroll activities, representing its responsibility to the federal government for taxes owed. It effectively captures the flow of funds within accounting records by reflecting both the expense incurred and the liability created by this tax obligation.

The entries associated with other choices do not properly reflect the amounts or accounts involved in the employer's share of Social Security and Medicare taxes, leading to an inaccurate portrayal of the financial situation related to payroll taxes.