Handling Employees Advances and Payroll Cost in Quick Books

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Handling Employees Advances and Payroll Cost in Quick Books:

How to Run Payroll in Quick Books?

(When not using Payroll Module)

Normally at the month end, accrual for salaries is recorded. When you pay salary to your employees first adjust advances and rest will be paid in cash. Accounting entries depends on your accounting method, either Cash or Accrual base. In case of Accrual base accounting make General Journal Entry.

Follow the navigation:

Go to  à   Company TAB    à   Make General Journal Entries

Advance Against Salary entry: (Through General Entry/Write Check)

Advance to Employees Against Salaries Account (Cr.)

Cash/Bank Account (Cr.)

Salaries Payable/Accrual Recording in Journal Entry Form

Salary, Wages & Benefits Expense Account (Dr.)

Salary, Wages & Benefits Payable Account (Cr.)

Enter the name of Employee in Name column and Add description for the period of salary being paid.

Payment Entry with Advance adjustment will be:

Salary, Wages & Benefits Payable Account (Dr.)

Advance to Employees Against Salaries Account (Cr.)

Cash/Bank Account (Cr.)

Note:

Income Tax Withholding in some countries is ignored at the time of Salary payment.

In case of Cash Base Accounting, payment entry after adjustment of advance will be:


Select transaction date when you are giving salaries to your employees.

In Account select “Salaries and Wages Expenses” this account should be expense type and always be Debited.

Deduct 1,000 advance given to Mr. Adeel select “Advances against Salaries” enter 1,000 in Credit column.

Select Cash/bank Account and enter balancing amount in Credit column.

Click button "Save & Close" or "Save & New".

Get Quick report from Chart of Account about each account and customize as per your need.

Thank You!.

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