For the current month, Jackson Cement Co. incurred payroll expenses as follows:
Gross salaries and wages ........... $675,000
Payroll taxes: OASDI (Social Security Tax)- employer's share ........................ 41,850
HI (Medicare tax)-employer's share 9,788
726,638
Amounts withheld and paid to the government: Employee income taxes withheld (108,990)
OASDI-employees' share .......... ( 41,850)
HI-employees' share .................. ( 9,788)
a. What amount can Jackson claim as a tax deduction for salary and wage expense?
b. How much can Jackson deduct as tax expense?