Examples of Payroll Journal Entries For Salaries. Basics of Journal Entries Accounting Journal Entry Examples. Let's assume our company also has salaried employees who are paid semimonthly on the 15th and the last day of … Paid $3,500 salaries. #1 – Payroll Journal Entry Wage, Payroll … Outstanding wages are those wages that have been earned in one acctg period but will not be paid until the next. Cash account will be credited, as cash is going out of the business. 30 March, Salary paid to staff for the month of Ashadh Rs 45,000. Payroll Journal Entry Examples: ABC Company has one employee, Mary Smith, that is paid weekly. When a company ends its accounting period in the middle of a pay period, the company must make an adjusting entry to show the unpaid salary and wages obligation. The payroll process examples below are a weekly payroll journal entry which includes her gross wages, payroll withholding, and ABC Company’s cost. Journal Entry For Paid Wages.Wages is a nominal account and because this is an expense of Business, as such, Wages account will be debited according to the rule of “Debit all expenses”. Sometimes you will see all the taxes lumped together into one account called Payroll Taxes Payable. NOTE: In the following examples we assume that the employee's tax rate for Social Security is 6.2% and that the employer's tax rate is 6.2%. [Q1] The entity paid $8,000 salaries expense in cash. Prepare a journal entry to record this transaction. Results of Journal Entry. [Journal Entry] --> Decrease in Assets Salaries Expense account balance increases by $3,500. These journal entries ensure appropriate income statement and balance sheet entries. Payroll Journal Entry. Amount Paid > enter the net wages value > if required, enter a reference. Under real time information, the date you actually pay your employees should be the same as the pay date in Payroll. Wages due but not paid ₹1000 This is a case of outstanding expense. Every day a company accrues a liability for salaries and wages until salaries and wages are actually issued to employees on payday, as explained by the Net MBA website. Normally the employee would be paid the amount of 1,100, however in this case the wage advance of 300 made earlier in the month needs to be deducted from the amount due, and the employee will be paid the balance of 800. As part of the payroll process, companies have to make journal entries to recognize the expense for wages and labor burden (benefits and taxes) and balance those entries … Cash balance decreases by $3,500. Here is the payroll journal entry to record the payment of the paycheck: Payroll Journal Entry Example 1. Suppose in the above example the net wages due to the employee were 1,100. Ledger Account > choose Net Wages (2220 or 2250) > if required enter any additional details. Notice the Wage Expense is debited for the gross pay. 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