• Solarsys
• January 18, 2013

Payroll

Software: MoneyWorks accounting software

The MoneyWorks accounting software doesn’t have a Payroll module built in. To record the Salary payment to your staff you may consider using the Payment transaction.

Assuming you have an employee with a salary of $2,000.00, the CPF employee is at 20% and CPF employer is at 17%. On top of that a CDAC fund of $1.00 need to be deducted from the employee salary.

In the above example, there are two payment need to be made. One is paid to the employee and the other to CPF Board.

You may create the employee name as a Supplier name type and the account used in the Payment transaction will be:

Salary expense account:               $2,000.00

CPF Employer expense account: $340.00 ($2000 * 17%)

Less: CPF Payable (Current Liability account type, for CPF employer): ($340.00)

Less: CPF Payable (Current Liability account type, for CPF employee at 20%): ($400.00)

Less: CPF Payable (Current Liability account type, for CDAC fund): ($1.00)

The net payable to staff will be: $1,599.00 and this amount will be deducted from the Bank account.

The double entry for this transaction will be:

Debit: Salary Expense: $2,000.00

Debit: CPF Employee Employer expense account: $340.00

Credit: CPF Payable (Current Liability account): $340.00

Credit: CPF Payable (Current Liability account): $400.00

Credit: CPF Payable (Current Liability account): $1.00

Credit: Bank account: $1,599.00

The next payment is to pay CPF Board for the amount owing of $741.00. The double entry for this payment will be:

Debit: CPF Payable (Current Liability account): $741.00

Credit: Bank account: $741.00