At September 30, 2022, the end of the first year of operations at Lukancic Inc., the firm’s accountant neglected to accrue payroll taxes of $4,700 that were applicable to payrolls for the year then ended.

Required:
a. Use the horizontal model (or write the journal entry) to show the effect of the accrual that should have been made as of September 30, 2022.
b. Determine the income statement and balance sheet effects of not accruing payroll taxes at September 30, 2022.
c. Assume that when the payroll taxes were paid in October 2022, the payroll tax expense account was charged. Assume that at September 30, 2023, the accountant again neglected to accrue the payroll tax liability, which was $5,000 at that date. Determine the income statement and balance sheet effects of not accruing payroll taxes at September 30, 2023.