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General Accounting Discussions: Payroll Jrn for a salary advance

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    • CommentAuthorKristian
    • CommentTimeJan 30th 2010
     
    Hi Everyone,

    I am having to input payroll journals for Month End and I have an employee who has had a salary advance through the month. the amount, say £100 has already been paid from my bank a/c (1200) to Net Wages (2220). Now I am processing the journal entries the payment has been deducted off my net wages and is leaving the credit side of my jrn £100.00 short. Where do I post this £100 now? Any answers gratefully received.
    • CommentAuthorherrcui
    • CommentTimeJan 30th 2010
     
    Hi Kristian,

    I would say you may need to make two journals:

    Dr. Bank 100
    Cr. Salary Expense 100

    Dr. Salary Expense 100
    Cr. Payroll Clearing/Accrual 100

    The second journal should be made a reversing journal until the actual salary expense occurs.
  3.  
    @Kristain and nice work. You are doing a good job and i appreciate you
    • CommentAuthorpk
    • CommentTimeFeb 3rd 2010
     
    When you make a salary advance to an emplyee, pass the following entry:

    Dr. Employee Receivable
    Cr. Bank


    When the advance is recovered thru payroll:

    Dr. Salary Expenses (gross amount)
    Cr. Employee Receivable (advance amount)
    Cr. Bank (net amount)


    savin.yakeep@yahoo.com

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