Question

accounting requirements for recognizing Payroll

Answer 1

Ans- As with most expenses, generally accepted accounting principles, commonly referred to as GAAP, prescribe that payroll expenses are recognized as they are incurred. This means it does not matter when the employee is paid, if the employee has worked, the company must recognize an expense.

Payroll expenses charged to the employer:

Date	Account	Debit	Credit
06/01/2020	Salaries and Wages	$4,650
06/01/2020	Employee FICA Payable		$800
06/01/2020	Federal W/H Payable		$1,500
06/01/2020	State W/H Payable		$700
06/01/2020	Employee Health Insurance Payable		$600
06/01/2020	Employee 401k Payable		$750
06/01/2020	Garnishments Payable		$300
06/01/2020	Payroll Expense	$3,522
06/01/2020	Employer FICA Payable		$800
06/01/2020	FUTA Payable		$2
06/01/2020	SUTA Payable		$45
06/01/2020	Employer Health Insurance Payable		$900
06/01/2020	Employer 401k Payable		$750
06/01/2020	Workers Comp Payable		$275
06/01/2020	Accrued Vacation		$500
06/01/2020	Accrued Sick Time		$250

Payroll expenses charged to the employee-

Date	Account	Debit	Credit
06/05/2020	Employee FICA Payable	$800
06/05/2020	Federal W/H Payable	$1,500
06/05/2020	State W/H Payable	$700
06/05/2020	Employee Health Insurance Payable	$600
06/05/2020	Employee 401k Payable	$750
06/05/2020	Garnishments Payable	$300
06/05/2020	Employer FICA Payable	$800
06/05/2020	FUTA Payable	$2
06/05/2020	SUTA Payable	$45
06/05/2020	Employer Health Insurance Payable	$900
06/05/2020	Employer 401k Payable	$750
06/05/2020	Workers Comp Payable	$275
06/05/2020	Payroll Account		$7,422

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