Final answer:
The statement is true; the Payroll Summary report displays the employer taxes associated with each employee, which include both the employee and employer shares of Social Security and Medicare taxes, along with any federal and state unemployment taxes.
Step-by-step explanation:
The statement that "The Payroll Summary report shows employer taxes associated with each employee" is true. Payroll taxes in the United States are comprised of deductions made from an employee's wages, such as Social Security and Medicare taxes, as well as taxes paid by the employer based on the employee's wages. These employer taxes are for the employer's share of Social Security and Medicare, federal unemployment taxes, and any state and local payroll taxes.
Employers are responsible for withholding the correct amount from their employees' paychecks for Social Security, which is 6.2%, and Medicare, which is 1.45%. Additionally, employers pay a matching amount for Social Security and Medicare. It's important to note that some economists argue that the cost of the employer's share of payroll taxes could be passed to employees in the form of lower wages.
Individual income taxes are also withheld from an employee's paycheck and are part of payroll taxes. However, whether the taxes are ultimately shouldered by the employer or the employee, they are recorded and reported to tax authorities, typically on a quarterly and annual basis. A Payroll Summary report typically includes all these taxes to reflect the total tax liability associated with employing a workforce.