93. Indicate whether each of the following statements is true or false.
_____ a) The amount of federal tax withheld from an employee's salary depends on the employee's gross pay and the number of withholding allowances the employee claims.
_____ b) Withheld taxes are recorded in the payroll tax expense account.
_____ c) An employer will submit $7,500 in FICA taxes for an employee who earns $50,000 annually.
_____ d) A voluntary deduction, such as a charitable contribution, creates a liability when it is withheld from employee pay.
_____ e) If an employer records gross pay of $1,200 and withholds $350 of that amount, they will recognize $850 in salary expense.
94. Indicate whether each of the following statements is true or false.
_____ a) Operating cycles for most businesses are less than one year.
_____ b) If a business does not plan to use any of its current assets to repay a debt, then that debt is listed as long term even if it is due within a year.
_____ c) The current ratio is computed by dividing current assets by net income.
_____ d) The current ratio is a useful measure of a company's liquidity.
_____ e) Liquidity is the ability of a business to repay liabilities in the long run.