Preparing Payroll Records

2 1. Preparing Payroll Time Cards Salary – money paid for employee services Pay period – period covered by a salary payment Payroll – total amount earned by all employees for a pay period Total earnings – total pay due for a pay period before deductions (gross earnings/pay)

3LESSON Add the Hours column. CALCULATING EMPLOYEE HOURS WORKED page Add Hours Reg and Hours OT columns and enter the totals. 2.Calculate the number of overtime hours and enter the amounts. 1.Calculate the number of regular hours for each day and enter the amounts.

4LESSON 12-1 CALCULATING EMPLOYEE TOTAL EARNINGS page Enter the rate for regular time in the Rate column. 2.Calculate the regular earnings. Enter the amount. 3.Enter the rate for overtime. 4.Calculate the overtime earnings. Enter the amount. 5.Add the Amount column to calculate total earnings. Enter the amount of total earnings.

5 2. Payroll tax withholdings 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, including the employee

6LESSON 12-2 EMPLOYEE’S WITHHOLDING ALLOWANCE CERTIFICATE page Write the employee’s name and address 2.Write the employee’s social security number. 3.Check the appropriate marital status block. 4.Write the total number of withholding allowances claimed. 5.The employee signs and dates the form.

7LESSON 12-2 EMPLOYEE’S INCOME TAX WITHHOLDING – MARRIED PERSONS page Select the appropriate table. 2.Locate the employee’s total earnings. 3.Intersection of wages and number of allowances column.

8 2. Payroll tax withholdings Social security tax – a federal tax paid for old-age, survivors, and disability insurance Medicare tax – a federal tax paid for hospital insurance Tax base – the maximum amount of earnings on which a tax is calculated

9 3. Preparing payroll records Payroll register – a business form used to record payroll information Net pay – total earnings paid to an employee after payroll taxes and other deductions Employee earnings record – a business form used to record details affecting payments made to an employee

10LESSON 12-3 PAYROLL REGISTER page Health insurance premium deductions 2. Payment date 3. Employee personal data 9. Other employee payroll deductions 4. Earnings 10. Total deductions 5. Federal income tax withheld 11. Net pay 6. Social security tax withheld 12. Total, prove, and rule 7. Medicare tax withheld 13. Check number 1. Pay period date

11LESSON 12-3 EMPLOYEE EARNINGS RECORDS page Total and prove 5.Earnings, deductions, net pay 2.Employee personal data 1 1.Last day of quarter 4.Pay period 3.Beginning accumulated earnings 6. Updated accumulated earnings

12 Preparing payroll checks

13LESSON 12-4 PAYROLL BANK ACCOUNT 1.Prepare the check stub. page Prepare the check. 12

14LESSON 12-4 EMPLOYEE’S PAYROLL CHECK page Prepare the check stub of each employee’s payroll check. 2.Prepare each employee’s payroll check. 21