What Is Payroll Accounting?

Wage accounting is one of the most basic businesses of the financial and accounting department of each unit. It not only affects the vital interests of each employee, but also an important factor that directly affects product cost accounting. Payroll calculations by hand require a lot of energy and time from financial staff and are prone to errors. The use of computers for wage accounting can effectively improve the accuracy and timeliness of wage accounting. ^[1]

calculating wages

Wage accounting: gng z hé suàn

Composition of total wages: Total wages refer to the total amount of labor remuneration paid directly by all units to all employees of the unit within a certain period of time. All employees shall include fixed employees, contract employees, temporary employees and unplanned workers.

Total wages consist of the following six components:

The principle of calculating total wages should be based on all labor remuneration paid directly to employees. A few days ago, the wages of railway transportation companies were calculated in the following two forms, namely:

(1) Calculation of payable wages based on hourly wages

Wages payable = hourly wages + bonuses + allowances and subsidies + overtime pay + wages paid under special circumstances

(2) Calculation of payable wages based on piece rate

Piece-rate wages = unit-piece price × number of qualified products

Payable wages = piecework wages + allowances and subsidies + wages paid under special circumstances

Settlement of wages Settlement of labor compensation between railway transport enterprises and employees. The contents of wage settlement are: wages payable, deductions and actual payouts. Wages payable are wages payable to employees calculated in accordance with the content and calculation methods for the composition of total wages; withholding payments are deducted from wages or paid back on behalf of employees after advance payment to employees in accordance with regulations, such as House rents, utilities, compensation for employees' negligence, medical expenses of family members of employees, etc. The actual total refers to the net amount of wages payable after deductions.

Payroll accounting methods

There should be an "wages payable" account, which reflects the settlement of wages between the enterprise and its employees. The lender reflects the amount of wages payable to employees, the debit reflects the amount withheld from wages, paid salaries, and unearned wages carried forward at the end of the period. There is no balance in this account after the unearned wages are closed at the end of the period.

The main matter of the account processing method is: before the monthly salary is paid, according to the total amount of payable in the salary settlement summary table, withdraw cash from the bank, debit the "cash" account, and credit the "bank deposit" account. When paying wages, debit "wage payable" accounts and credit "cash" accounts based on the actual amount of the pay slip. Payments shall be deducted from the wages of employees, and according to the amount of deductions in the wage settlement summary table, "wages payable" shall be debited and accounts for "other payables" shall be credited; wages not received by employees within the prescribed period shall be deducted by The accounting department records the account, debits the "cash" account, and credits the "other payables" account. At the end of the month, the salary payable for the month should be allocated. According to the salary expense distribution summary table, debit "transport expenses", "internal supply and sales expenses", "industrial auxiliary expenses", "agent business expenses", "administrative expenses" , "Non-operating expenses", "Construction in progress", "Welfare payable" and other accounts are credited to the "Payable payable" account.

Calculation of payroll withholding

The monthly accounting department also needs to withhold certain amounts according to the deduction notices transferred from the relevant units and departments, such as the personally responsible part of social insurance premiums, personal income tax, housing provident fund, etc.

Social insurance is a social security system established by the state through legislation. The social insurance collected from all enterprises in China at this stage includes five types of insurance: basic endowment insurance, unemployment insurance, basic medical insurance, work injury insurance and maternity insurance. The basic endowment insurance, basic medical insurance and unemployment insurance are jointly paid by the unit and individual: the work injury insurance and maternity insurance are paid by the unit. The individual contribution of social insurance shall be withheld and paid from the employee's own salary by the company where he works.

In the payroll calculation, deductions must be deducted to calculate accrued wages and other items.