Spending money on Employee's Salary

Not sure what you mean. If traffic fine payment date and payslip date are the same dates, then both transactions will always appear on the same P&L. If you don’t see it that way, send your accounting file to support@manager.io.

Payslip

Wages & salaries = 2000
Deduction = 100
Total Payslip = 1900

I paid 1900 to my employee and i paid 100 for this deduction ( traffic fine ). Then i created profit and loss statement for my employee

Wages & salaries appears = 2000
Traffic Fine = 100
Total payments = 2100

But i paid 1900 + 100= 2000. On the report it appears 2100.

It’s because you need to create deduction item under SettingsPayslip Items

This deduction item should be mapped to expense category Traffic fines. When you create payslip for employee, use this deduction item to categorize traffic fine deduction. That will credit your Traffic fines expense account on P&L.

Right now, your traffic fine expense is not being credited by payslip, that’s why your P&L report shows 2,100 instead of 2,000.

Anyway, I’m working on guides to cover payroll, so perhaps you will need to study it when published.

So after creating the payslips, I need to proceed to either the bank account or cash account tab to Spend Money?

But when I Spend Money on either bank account or cash account, there will be two records of the same employee in the Employee Clearing Account, where one of them appearing in red (negative amount). Is this correct or something has erred?

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That’s right. When you create payslip, you will owe employee the net pay amount. When you pay employee, you will owe employee nothing. Basically issuing payslip and recording payment are two different transactions, that’s why there will be two entries in general ledger.

After payment of salaries, the amount expended does not show up on the expense account - Wages & Salaries. It goes to suspense and shows as negative. Please what have I done wrong?

Please list the steps you take in paying salaries so that we can help.

Thanks

I go to cash account (petty cash) and click on spend money. I select the employee clearing account and the name of the salary earner and the amount to be paid. I then finalize the procedure by saving the transaction(create). This should decrease the employee clearing account and show the record on wages & salary at the expense column.

I believe you used the payslip function. If you did, it will create an expense (debit wages) and create a liability (credit clearing account).
So during payment cash will reduce (credit) and therefore the liability will reduce (debit).
The wages account will not be involved in the payment stage. The Payslip process debited it.

If you however want to pay salaries straight from bank or cash without any accruals or accrued salaries then when you want to spend money select wages/salaries account (expense) and make payment. That will debit expense and. Credit bank or cash

Thanks Abeiku.