PAYROLL ACCOUNTING
Payroll Accounting is the function of calculating and distributing wages, salaries, and withholdings to employees and certain agencies. It is generally done through various documents. Examples of these are time sheets, paychecks, and a payroll ledgers. As your Payroll Account, it is up to Hicks Accounting to reports to our clients, so that they are able to make informed decisions about the company’s labor-cost and data.
Payroll Functions
There are six major job functions that Hicks Accounting performs throughout the year for the payroll department or specialized businesses.
- Compute gross pay (hourly or salary)
- Compute the total amount of deductions (FICA, taxes, etc.)
- Calculate the total amount due to employees i.e. the gross pay minus the amount of deductions.
- Authorize the amount of payments due to employees.
- Distribute the payroll once authorized.
- Issue reports to upper management concerning labor-cost data.
Accounting Payroll System
In the past, accounting payroll systems consisted of two journals. The first is the payroll journal. Then, the second is the payroll disbursements journal. Companies used the payroll journal to accrue for salaries and wages towards employees as well as government obligations withheld from the employee’s paycheck. Companies used disbursements journal to pay off these accumulated accruals when they became due.
In the modern era, Hicks Accounting reccomends computer systems like Peachtree and Quickbooks, they have combined both of these journals into a payroll ledger for those looking to keep their own business ledger. It's always easiest to leave things up to us to make your payroll accounting simple and correct.
