Direct deposits are made through electronic funds

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Unformatted text preview: addition to the payroll register, an employer must also keep an employee’s earnings record for each employee. This record contains all of the payroll information related to an employee. Figure 12–7 on page 324 shows an example of an employee’s earnings record. The earnings record and payroll register have the same amount columns: • • • • • three earnings columns four columns for deductions required by law additional columns for voluntary deductions (in this case, two columns) the Total column the Net Pay column An additional column for the employee’s accumulated earnings is also provided. Accumulated earnings are the employee’s year-to-date gross earnings. That is the amount of the employee’s gross earnings from the beginning of the year through the end of the pay period just completed. The accumulated earnings for Emily Kardos as of June 30 are computed by adding her gross earnings for the pay period just completed to her accumulated earnings for the previous pay period as follows: Gross Earnings for Pay Period Just Completed $243.00 Accumulated Earnings for Previous Pay Period $4,178.60 Accumulated Earnings for Pay Period Just Completed $4,421.60 Businesses keep employees’ earnings records on a quarterly basis. This makes it easier to complete government reports that are required each quarter. At the end of a quarter, the amount columns on each employee’s earnings record are totaled. The final amount in the Accumulated Earnings column is carried forward to the top of the employee’s earnings record for the next quarter. Figure 12–7 on page 324 illustrates how accumulated earnings amounts are carried forward. As you can see from this chapter, preparing payroll is time consuming and detail oriented. A mistake that is not promptly detected and corrected can mean hours of rework. To reduce simple mathematical errors and to improve productivity, many businesses use computers and special software to prepare payroll. In a computerized system, the computer • • • • perf...
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