Mastering Departmental Payroll Systems

1. LESSON 3-1 Completing Payroll Records for Employee Earnings and Deductions

2. Chapter 3 ObjectivesCalculating and Recording Departmental Payroll Data After studying Chapter 3, you will be able to: • Define accounting terms related to a departmental payroll system. • Identify accounting concepts and practices related to a departmental payroll system. • Prepare a commissions record and calculate commission on net sales. • Complete payroll records. • Journalize payroll transactions. LESSON 3-1

3. Lesson 3-1 • salary: the money paid for employee services • pay period: the period covered by a salary payment • payroll: the total amount earned by all employees for a pay period • payroll taxes: taxes based on the payroll of a business • withholding allowance: a deduction from total earnings for each person legally supported by a taxpayer • tax base: the maximum amount of earnings on which a tax is calculated LESSON 3-1

4. Lesson 3-1 • payroll register: a business form used to record payroll information • employee earnings record: a business form used to record details affecting payments made to an employee LESSON 3-1

5. PAYROLL DEDUCTIONS page 61 LESSON 3-1

6. Regular Hours Regular Rate Regular Earnings ´ = 80 ´ $7.00 per hour = $560.00 Overtime Hours ´ Regular Rate ´ 1.5 = Overtime Earnings 5 ´ $7.00 ´ 1.5 = $52.50 RegularEarnings + OvertimeEarnings = TotalEarnings $560.00 + $52.50 = $612.50 CALCULATING EMPLOYEE EARNINGS page 62 LESSON 3-1

7. COMMISSIONS RECORD page 63 1 2 3 1. Record heading information. 2. Obtain amounts and calculate totals. 3. Calculate commission on net sales. LESSON 3-1

8. 4 9 9 PREPARING A PAYROLL REGISTER pages 64-65 1 2 3 5 1. Payroll period ending date 6 7 8 2. Date of payment 3. Employee information 4. Hours and earnings 5. Total earnings by department 6. Payroll deductions 7. Total deductions 8. Net pay 9. Totals LESSON 3-1

9. 2 3 1 USING THE FEDERAL INCOME TAX WITHHOLDING TABLE page 66 1. Locate the range containing the total earnings. 2. Find the column with the correct number of withholding allowances. 3. Find the intersection of the row and column. LESSON 3-1

10. 5 PREPARING AN EMPLOYEE EARNINGS RECORD page 67 2 1 3 4 6 1. Write last day of quarter. 2. Enter heading information. 3. Record beginning accumulated earnings. 4. Write ending day of pay period. 5. Enter total earnings, deductions, and net pay. 6. Calculate and record accumulated earnings. LESSON 3-1

11. DEFINE TERMS REVIEWIn Quizlet page 68 Create: Chapter 3 AdvAcc (then SAVE) • salary • pay period • payroll • payroll taxes • withholding allowance • tax base • payroll register • employee earnings record LESSON 3-1

12. Exit Ticket for today:Audit Your Understanding 3-1 In a Word Document, SaveAS: Chapter3-1AYUYourName And drop in my Inbox today! • What three federal taxes are withheld from an employee’s pay? • How is the amount of federal income tax withholding determined? • What is the formula for calculating net pay on the payroll register? • What amount is added to the accumulated earnings to get the new accumulated earnings to date? LESSON 3-1

13. Complete the following assignments for Chapter 3-1 today • Define Terms Review on page 68. • Answer Audit Your Understanding questions on page 68. • Complete Work Together 3-1 on Aplia – page 68. • Complete On Your Own 3-1 on Aplia – page 69. • Complete Application Problem 3-1 on Aplia – page 78. • Complete Application Problem 3-2 on Aplia – page 78-79. • Complete Application Problem 3-3 on Aplia – page 79. LESSON 3-1