The First Step in the Recording Process in a Computerized

question 75

Multiple Choice

The first step in the recording process in a computerized environment is to

• A) prepare financial statements.
• B) analyze the transaction in terms of its effect on the accounts.
• C) post to a journal.
• D) prepare a trial balance.

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Definitions:

Federal Withholding

The process by which an employer deducts a portion of an employee's income and pays it directly to the government as an advance payment of the employee's tax liability.

FICA

Federal Insurance Contributions Act, the U.S. law that requires a payroll tax on both employees and employers to fund Social Security and Medicare.

FICA Taxes

Federal Insurance Contributions Act taxes, funding Social Security and Medicare, deducted from employee paychecks and matched by employers.

Federal Income Tax

A tax levied by the U.S. federal government on the annual earnings of individuals, corporations, trusts, and other legal entities.