Vaughnincurs a weekly payroll of $255000that includes federal taxes withheld of $37600, FICA taxes withheld of $23670, and 401(k) withholdings of $27000. What is the effect on assets and liabilities from recording this transaction? (Ignore company payroll taxes).

Assets decrease $193730and liabilities decrease $61270.

Assets decrease $166730and liabilities increase $88270.

Assets decrease $193730and liabilities increase $61270.

Assets decrease $255000and liabilities do not change.