On Sun, 2003-07-27 at 11:04, Derek Atkins wrote: > Phil Longstaff <[EMAIL PROTECTED]> writes: > > > Disclaimer: IWNEAAABIANWAO (I was not educated as an accountant but I am > > now working as one) > > > > On Wed, 2003-07-23 at 11:14, Derek Atkins wrote: > > > > > Why can't you have a transaction that looks like this: > > > > > > 2003-01-15 Derek Atkins > > > Expenses:Salaries $85 > > > Expenses:Tax-1 $10 > > > Expenses:Tax-2 $5 > > > Liabilities:Tax-1 $10 > > > Liabilities:Tax-2 $5 > > > Assets:Checking $85 > > > > > > > Unfortunately, this is wrong. For one thing, the proper amount to hit > > Salaries with is the gross salary. > > That would artificially inflate your expenses! If you put the full > gross salary into Expenses:Salaries then you'd have expenses of $115, > when in reality you only have expenses of $100 (assuming no company > payroll taxes).
If my company pays an employee $50,000 in gross salary and an additional $5000 in employer taxes, then the cost to me is $55,000, regardless of how the employee's $50K gross salary is split into taxes and other withholdings. The expenses I have are the $50K salary, and the $5K employer taxes. > > > Secondly, the various taxes or other > > things withheld from my gross salary to produce my net salary are not > > liabilities for the company. > > This is not true, either... When you withhold taxes from your > employees that is DEFINITELY a liability -- it's money you still have > which you owe the gov't. That certainly sounds like a liability to me > (sort of how A/P is a liability!). When you pay the gov't the withheld > taxes then you pay down the liability. I reread what I wrote, and you're right. I meant to say "the various taxes ... are not expenses for the company". If the company holds them to pass on to the gov't, they are liabilities at that point. > I'll repeat here what I've said elsewhere: GnuCash DOES NOT DO > PAYROLL. You are welcome to account for it however you wish, but do > NOT expect GnuCash to be able to maintain enough information to, say, > write a W-2 at the end of the year. GnuCash does not keep around > enough information for this. However, given double-entry accounting, it should be straightforward to set up accounts to allow you to generate W-2's (you'd need a deep enough account hierarchy to allow you to keep info per employee). I agree that functionality on top of the basic double-entry accounting makes the job easier. > > If I have a gross salary of $100 from which $10 needs to be withheld for > > tax1 and $20 for tax2, then we have: > > > > DB CR > > Expenses:Salaries $100 > > Liabilities:Tax1 $10 > > Liabilities:Tax2 $20 > > Liabilities:Employees:Phil $70 > > And now you're contradicting yourself. You earlier said "the various > taxes or other things withheld from my gross salary to produce my net > salary are not liabilities for the company" but here you are making > them liabilities! So, which is it? See above. I mean't they aren't expenses (to the company). Phil _______________________________________________ gnucash-devel mailing list [EMAIL PROTECTED] http://www.gnucash.org/cgi-bin/mailman/listinfo/gnucash-devel
