Hi there, I am quite new to this site and noticed that the help here is extremely useful.
Anyway, I am learning SAGE by self teaching myself and doing evening courses to help me. What I dont understand is Journals.
Would someone be able to explain to me what Journals are and why I need to use them.
Also I have found out that I need to use Journals for employee wages, can someone also help me understand how I input the information for wages step by step please.
He's great at down to earth explanations, especially terminology. When I started in 1982, 1 half of the double entry was done in the computer room and the other half across the landing, on pencil and paper lol
I'm sure he won't mind me recommending it to you.
-- Edited by Don Tax on Tuesday 28th of June 2011 05:53:34 PM
The journal entry for wages in sage is the following:-
Dr 7000 - Gross wages
Dr 7006 Employers NI
Cr 2220 Net Wages
Cr 2210 PAYE
CR 2211 NI (Total Ni - employers and Employees)
This being that the Dr's - gross wages and employers NI are cost to the company (Expense) and the CR's are a liability until they are paid. Once the net wages, NI and PAYE have been paid they wil automatically go to a zero balance.
The amount paid from the bank account is the net wages - after PAYE and NIC. The P&L figure for wages should be gross. As shown by Sammy1 above, employer's NI also needs taking into account.
Journals are also used to ensure errors are not made. If you Jnl the Wages, when you make the various payments you can check they are correct. The Jnls post the wages to control accounts on the B/s and by putting the payments againsts these control accounts, if any of the payments are wrong, there will be an outstanding balance left on the control account. It makes it very easy to find payment errors.
The reason many people make errors with payroll is they don't use Jnls.
-- Edited by YLB-HO on Thursday 30th of June 2011 04:47:15 PM
Understanding journals is another reason why one should get to grips with manual bookkeeping before tackling a computerised package
Pauline
I agree
Me too.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
