Washington County's Business Technical Innovation Center
Payroll

 

LIABILITIES
OBLIGATION TO TRANSFER ASSETS OR PROVIDE SERVICES

  • Payroll is Employee Compensation
    • Payroll deductions
      • Employee income tax (Determined from State and Federal Tax Withholding Tables)
      • Federal Insurance Contributions Act (FICA) Social Security, (Check with your accountant to determine current rate.)
  • Entries
    • To record Salary Expense
      • DEBIT – Salary Expense (gross)
        CREDIT – Employee Income Tax Payable (amounts withheld)
        CREDIT - FICA Tax Payable (8%)
        CREDIT – Employee Union Dues Payable
        CREDIT – Salary Payable to Employees (net)
    • To record employer’s payroll taxes
      • DEBIT – Payroll Tax Expense
      • CREDIT – FICA Payable
      • CREDIT – State Unemployment Tax Payable
      • CREDIT – Federal Unemployment Tax Payable
    • To record fringe benefits
      • DEBIT – Health Insurance Expense
      • DEBIT – Life Insurance Expense
      • DEBIT – Pension Expense
      • CREDIT – Employee Benefits Payable
  • Payroll Register – Special Payroll Journal
  • Payroll Bank Account – special account which contains the exact amount of net pay to employees for the period

 

Partners
Smith Elliott Kerns and Company
 
Hagerstown Convention and Visitors Bureau