Payroll process is maintained by every business irrespective of its size being large corporation or small sized firms. Every business needs a set of employees that can tackle the duties and productivity of the business to make it prosper and in turn it is businesses that compensate by providing salary to the employees. This calculation of salary and other benefits is what payroll processing is all about. The topic itself is quite vast and for any other issue or information related to same, user should immediately get in touch with the QuickBooks Payroll Support Number for certified QuickBooks Payroll experts .
Under this process, the employer calculates the total of gross salary for each and every employee, write off the amount of benefit deductions that would result in net pay / salary. Gross salary basically indicates the wages remunerated to employee as per the agreement / job contract signed between him and the company and in tandem with the current labor rate going within the city. On the other hand Net Salary is the amount of Gross salary left after reducing the deduction amount from the pay. Many companies prefer to use both Payroll Journal and Payroll Register for noting down all the financial transactions and payroll related data.
Payroll Journal basically records those financial transactions which impacts the business due to miscellaneous payroll processes. It consists of a table with columns representing all those accounts that get impacted due to payroll processing including wages expense, insurance payable, tax payable and cash, wherein –
▩ Wages Expense consists of details regarding the gross pay of all the employees.
▩ Insurance Payable contains data revolving around the premium of health insurance paid by the employees as deducted from their paychecks.
▩ Tax Payable category of account contains details around FICA Taxes and incomes owed by employees paid via deductions from employee’s pay.
▩ Cash account is the last account pertaining to end wage amount forwarded to employees after deductions.
Payroll Journal is maintained to in order to store all employee payroll related details including the ones that are omitted, reported along with record of dollar amount. Only employees’ related transactions are kept within the Payroll Journal. Rest of the transactions of financial nature happening within the business is reported under the cash account and general journal as well as ledger. The full amount dollars noted payroll journal equalizes for each and every payroll transaction recorded. This total dollar amount is recorded whenever the company processes its payroll details.
Payroll Journal can be accessed by each and every employees dealing with accounts of the business. Each Journal Entry comprises of two elements, namely, Debits and Credits. After completion of each entry into journal, debit amount should be equal to credit amount. Otherwise, the entry will be treated as incorrect. Even the most basic small business company will have at least following accounts in its payroll journal entry – Wages Expense, State Income Withholding Payable, Federal Income Withholding Payable, FICA Tax Payable, and Payroll Payable. In case of any other special payroll categories user will have to maintain a separate account. Suppose the company hosts 401k plan for employees, then it will have to cater for the same with a special account named 401k Plan Expense Account.
A payroll Journal can have many accounts in accordance with the requirements and functions of the business. However, even the most basic small business company will have at least following accounts in its payroll journal entry:
▩ Wages Expense
▩ State Income Withholding Payable
▩ Federal Income Withholding Payable
▩ FICA Tax Payable
▩ Payroll Payable
In case of any other special payroll categories user will have to maintain a separate account. Suppose the company hosts 401k plan for employees, then it will have to cater for the same with a special account named 401k Plan Expense Account.
Payroll Expense account initially needs to be debited in order to increase the range of the expenses through payroll processing for the set period of time. This is where journal entry comes in – recording of the amount in order to debit expense account is started through recording of transaction in journal entry. Such as – Suppose a business is left with payroll amount of $50,000, then the first entry in Journal Entry and subsequent report is debit of $50,000 expense account. In the general ledger the Payroll Account will showcase an increase of $50,000 as debit in an expense results in increase in the expense.
The above detail of Journal Payroll and its Reports under QuickBooks Payroll is just a small section of Payroll Journal Entries. Alternatively, they can also get in touch support agencies like QuickBooks Payroll Help through their website – QBPayrollHelp or call on their Toll Free Number – 1844 827 3817.