The Graph Shown Displays Various Economic Outcomes

question 36

Multiple Choice

The graph shown displays various economic outcomes. If the economy is currently at equilibrium B, and the government increases its spending:

• A) the level of output will increase.
• B) the economy will experience deflation.
• C) the unemployment rate will increase.
• D) All of these are likely to be true.

Identify employer responsibilities for payroll taxes including FICA, FUTA, and SUTA.

Classify salaries and wages as either current liabilities or expenses and record them accordingly.

Understand the federal income tax withholding process and its impact on employee's net pay.

Recognize the significance of proper payroll accounting and its impact on business operations.

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Definitions:

Materials Quantity Variance

Represents the difference between the actual quantity of materials used in production and the standard quantity expected to be used, multiplied by the standard cost per unit.

Raw Materials

Unprocessed or primary substances used in manufacturing to create finished goods.

Retained Earnings

Retained earnings represent the accumulated net income of a company that has not been distributed to shareholders as dividends but is reinvested in the business.

FOH Volume Variance

A measurement in managerial accounting that compares the budgeted factory overhead for actual production volumes against the applied factory overhead based on standard costing.