Quicken & Other Budget/Accounting Software/Payroll JE

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Question
Hi,

Every month we pay salary with taxes on the 15th each month (on 15/1/2015). January 2015 taxes is normally paid in early Feb 2015. I need to do accruals for the taxes whenever salary is paid. I only have one accrual account for salary and taxes which is called "Payroll Deductions Payable".(liability)

What is the debit and credit details for salary and taxes payments?

Answer
I recommend setting up a new liability account called
Accrual -Payroll Expense Liability

I like to post the accrual to a separate expense account called Accrued Payroll expense.
I like to do so , so that at the end of the year the salaries expense account can be reconciled to the payroll forms filed with the government. It would also be fine to
post directly to the salary and wage accounts but then the reconcilation is not so easy.

The Journal entry  1/31 would be
Debit Accrued Payroll expense
Credit Accrual - Payroll Expense Liability

Then immediately do your reversal  using a 2/1/15 date or the payroll date in Feb

Debit Accrual - payroll expense liability
credit Accred payroll expense.

Linda Saltz, CPA
Advanced Certified QuickBooks Advisor
http://www.qbalance.com
We sell and support QuickBooks Enterprise  

Quicken & Other Budget/Accounting Software

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Linda Saltz, CPA, QBalance.com

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QuickBooks best practices, troubleshooting, accounting, tax We have over 70 pages of website content about QuickBooks tips, running a business, tax and business startup at http://www.qbalance.com

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Accountant and CPA over 20 years. Specializing in accounting software for over 12 years, Certified QuickBooks Pro Advisor, QuickBooks seminar instructor since 1997.
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