Chapter 15: Chapter 15: Employees, Payroll, and Employees, Payroll, and Account ReconciliationAccount Reconciliation

McGraw-Hill/Irwin Copyright © 2011 by The McGraw-Hill Companies, Inc. All rights reserved.

Employees, Payroll, and Employees, Payroll, and Account ReconciliationAccount Reconciliation

Employees and employers are required to pay local, Employees and employers are required to pay local, state, and federal payroll taxes. Employers must state, and federal payroll taxes. Employers must withhold taxes from each employee’s paycheck. The withhold taxes from each employee’s paycheck. The amount withheld for federal taxes is determined from amount withheld for federal taxes is determined from tax tables published by the IRS.tax tables published by the IRS.The amount withheld depends on the employee’s The amount withheld depends on the employee’s earnings and the number of exemptions or withholding earnings and the number of exemptions or withholding allowances claimed by the employee. FICA taxes and allowances claimed by the employee. FICA taxes and Medicare taxes are also deducted from employee’s Medicare taxes are also deducted from employee’s paychecks.paychecks.It is the purpose of Chapter 15 to show you how to use It is the purpose of Chapter 15 to show you how to use Peachtree to enter payroll default information, add Peachtree to enter payroll default information, add employees, make journal entries for payroll, print employees, make journal entries for payroll, print payroll reports, and complete account reconciliation.payroll reports, and complete account reconciliation.

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Peachtree TipsPeachtree Tips

The exercises in Part 3 are cumulative. Exercises 12-1 through 14-The exercises in Part 3 are cumulative. Exercises 12-1 through 14-2 must be completed before starting Exercise 15-1. 2 must be completed before starting Exercise 15-1. The Payroll Entry window is the Payroll Journal.The Payroll Entry window is the Payroll Journal.In order for payroll taxes to be computed automatically, students In order for payroll taxes to be computed automatically, students need to copy the TAXABLE.DAT file (pages 592-594), check that need to copy the TAXABLE.DAT file (pages 592-594), check that the user-maintained payroll tables are included for Georgia (pages the user-maintained payroll tables are included for Georgia (pages 594-596); establish the payroll account (page 596); use the Payroll 594-596); establish the payroll account (page 596); use the Payroll Setup Wizard (pages 597-601); enter employee and employer Setup Wizard (pages 597-601); enter employee and employer default information (pages 602-604); and then complete payroll default information (pages 602-604); and then complete payroll setup (pages 604-608).setup (pages 604-608).If you do If you do notnot want to copy the TAXABLE.DAT file, payroll taxes can want to copy the TAXABLE.DAT file, payroll taxes can be entered manually on the Payroll Entry window. Refer to be entered manually on the Payroll Entry window. Refer to textbook pages 614 and 617 for completed payroll taxes. The textbook pages 614 and 617 for completed payroll taxes. The Taxes – Benefits – Liabilities table lists the amount for both Taxes – Benefits – Liabilities table lists the amount for both employee and employer withholdings. The Payroll Journal on employee and employer withholdings. The Payroll Journal on pages 619-621 also shows withholding amounts.pages 619-621 also shows withholding amounts.

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Backing Up Chapter 15Backing Up Chapter 15

Backup (.ptb extension)Backup (.ptb extension)

Excel (.xlsx) Excel (.xlsx)

KilobytesKilobytes

Page Page

Nos.Nos.

Chapter 15 Begin.ptbChapter 15 Begin.ptb 1,514 KB1,514 KB 611-612611-612

Chapter 15.ptbChapter 15.ptb 1,542 KB1,542 KB 634634

Chapter 15_PayJ_GLTB_BS_IS_SCF.xlsxChapter 15_PayJ_GLTB_BS_IS_SCF.xlsx 34 KB34 KB 634634

Exercise 15-1.ptbExercise 15-1.ptb 1,414 KB1,414 KB 641641

Exercise 15-2.ptbExercise 15-2.ptb 1,450 KB1,450 KB 644644

Exercise 15-2_EL_CL_VL_IVR_PayJ_Exercise 15-2_EL_CL_VL_IVR_PayJ_

GLTB_BS_IS_SCF.xlsxGLTB_BS_IS_SCF.xlsx 46 KB46 KB 645645

This information is also shown on textbook page 433.

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Account Reconciliation, pp. 621-622Account Reconciliation, pp. 621-622

Read page 621. Peachtree’s Read page 621. Peachtree’s general ledger is integrated general ledger is integrated with other parts of the with other parts of the program.program.The Southern Bank bank The Southern Bank bank statement is on pp 622-623.statement is on pp 622-623.Payroll Checking Account Payroll Checking Account bank statement is on p. 623.bank statement is on p. 623.Printing Reports: Account Printing Reports: Account Reconciliation, General Reconciliation, General Ledgers, Customer Ledgers, Ledgers, Customer Ledgers, Vendor Ledgers, and Inventory Vendor Ledgers, and Inventory reports are on pp. 623-629. reports are on pp. 623-629.

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Glossary of TermsGlossary of TermsChapter 15Chapter 15

Exemptions, p. 587Exemptions, p. 587

These are withholding allowances These are withholding allowances claimed by the employee. The number of claimed by the employee. The number of exemptions or withholding allowances exemptions or withholding allowances usually includes one for the employee, usually includes one for the employee, one for the employee’s spouse, and one one for the employee’s spouse, and one for each dependent.for each dependent.

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Withholding allowances, p. 587Withholding allowances, p. 587

Exemptions claimed by the employee. Exemptions claimed by the employee. The number of exemptions or The number of exemptions or withholding allowances usually includes withholding allowances usually includes one for the employee, one for the one for the employee, one for the employee’s spouse, and one for each employee’s spouse, and one for each dependent.dependent.

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FICA taxes, p. 587FICA taxes, p. 587

This deduction from wages is also called This deduction from wages is also called the social security tax and provides the social security tax and provides qualified workers who retire at age 62 or qualified workers who retire at age 62 or older with monthly payments from the older with monthly payments from the federal government. A portion of this tax is federal government. A portion of this tax is for Medicare.for Medicare.

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Medicare, p. 588Medicare, p. 588

A portion of FICA taxes (also called social A portion of FICA taxes (also called social security taxes) deducted from wages of security taxes) deducted from wages of qualified workers. Medical benefits called qualified workers. Medical benefits called Medicare are received by retirees after Medicare are received by retirees after reaching age 65.reaching age 65.

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W-2 forms, p. 588W-2 forms, p. 588

An annual report of an employee’s wages An annual report of an employee’s wages subject to FICA and federal income tax subject to FICA and federal income tax that shows the amounts of these taxes that shows the amounts of these taxes that were withheld.that were withheld.

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Internet Activity, p. 635Internet Activity, p. 63511 Go to the book’s website at Go to the book’s website at www.mhhe.com/yacht2011.

22 Link to Student Edition. Link to Student Edition.

33 In the Choose a Chapter field, select Chapter 15. Observe that the Quizzes and More Resources list includes additional activities. In the Course-wide Content list, link Internet Activities; then link to Part 3 Internet Activities for Chapter 12-15. Select Open or Save.

44 Complete the SALARY WIZARD-Chapter 15 exercise. Read Complete the SALARY WIZARD-Chapter 15 exercise. Read steps 1-5. steps 1-5.

55 Follow the steps shown on the book’s website to complete this Follow the steps shown on the book’s website to complete this Internet activity.Internet activity.

66 Using a word processing program, write a brief summary of what Using a word processing program, write a brief summary of what you find. Include all appropriate website addresses.you find. Include all appropriate website addresses.

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Going to the Net, pp. 635-636Going to the Net, pp. 635-636

Access the Employer Reporting and Instructions Access the Employer Reporting and Instructions website at website at http://www.ssa.gov/employer/. Link to . Link to General W-2 Filing Information, then answer these General W-2 Filing Information, then answer these questions.questions.

1.1. What are dates that employers must send W-2 What are dates that employers must send W-2 information to the Social Security Administration? information to the Social Security Administration? (Include the dates for (Include the dates for bothboth electronic and paper electronic and paper filing.)filing.)

2.2. When must employers give employees their W-2? When must employers give employees their W-2? 3.3. What two forms do employers send to the Social What two forms do employers send to the Social

Security Administration?Security Administration?

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Assessment Rubric, p. 645Assessment Rubric, p. 645Date Transaction

Navigation Center/Module

TaskWindow

JournalDr./Cr.

1/7 Issue payroll Check No. 6050 to Rick Cramer for 40 regular hours.

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Analysis Question, page 645Analysis Question, page 645

What is the purpose of the What is the purpose of the TAXTABLE.DAT file? How do you check TAXTABLE.DAT file? How do you check that the company includes the payroll that the company includes the payroll formulas? formulas?

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