Under which type of accounting are the premiums paid by an employer for his employees' insurance typically recorded?

• A. Payroll Accounting
• B. Financial Accounting
• C. Tax Accounting
• D. Cost Accounting

Answer: (A)

Verified step by step guidance

1. Understand the context of the problem: The question is asking about the type of accounting under which employer-paid premiums for employees' insurance are typically recorded.
2. Review the definitions of the accounting types provided: Payroll Accounting, Financial Accounting, Tax Accounting, and Cost Accounting.
3. Analyze Payroll Accounting: This type of accounting deals specifically with employee-related expenses, including wages, salaries, and benefits such as insurance premiums.
4. Compare Payroll Accounting with the other options: Financial Accounting focuses on preparing financial statements, Tax Accounting deals with tax-related matters, and Cost Accounting focuses on tracking and analyzing costs for production or services.
5. Conclude that Payroll Accounting is the most relevant type for recording employer-paid premiums for employees' insurance, as it directly pertains to employee-related expenses.