You are the best in explaining JE,,,Thanks. Can you do a JE for recording 1. purchase of car with trade-in, cash, loan.....& all that fun stuff and 2. JE Recording HUD statements for real estate
It would depend on the situation and business structure. If the owner is normally paid with Draws (using Equity accounts), then any payments out that are personal would be treated as an owner draw. Yes a JE could be done. If the owner is a W-2 employee, then it would possibly be treated as a garnishment and payment.
@@michellenewberryI think garnishment should come from payroll, but that's not the case. The owner is S-CORP, he receives payroll and no amount is being withheld to pay child support. So he pays using business bank account. I did code it as owners draw. Am I right?
@@relaxedclub9425 Usually in a corporation it's called something like shareholder distributions but if they call it owners draw that's fine. But yes what you're doing sounds right.
My ADP Wages come through the connected bank account automatically with WAVE. The amount was exactly as it should be for wages (the top half of the excel sheet that includes Salaries Expense, Payroll tax expense and all the liabilities that are credited). In Wave I tried to split the Wage Portion transaction that came through (I made payroll liability accounts for all that was needed) and when all was added (from the top portion of the excel sheet - that equalled the bank withdrawal (which we see credited on line 16) the balance was way off. Do you suggest I delete the automatic ADP expense that came through from the bank to wave and just do a JE, or is there a way I can incorporate the salaries & payroll tax expense along with the payables (Fed & State Income Taxes payables, FICA tax payables, Fed & State Unemployment payables) to go with this automatic ADP expense that came through Wave?
What Wave did was add all the expenses and liabilities together as a grand total in the spit transactions. I would have thought that the liabilities would have been subtracted from the amount in order to equal the amount that came through the bank. Any idea why? Thanks so much!
I would really have to look at it to figure out what went wrong. The journal entries should have credits with amounts deducted from the checking account. It may be easier to skip the payables altogether. Debit salaries expense for gross pay, debit payroll tax expense for the employer taxes, credit checking account for the amounts coming out of the checking account. You may have two credits if there are two deductions from checking.
@@michellenewberry Hi, what if there are no wages? only taxes, my client is also using Wave and he doesn't have wages the ADP slip is all about the taxes, how should I categorize this? The bank transaction for paying ADP is tagged as an expense. These are all expense accounts only right? because no wages and all taxes only.
@honeyleneletada2971 That situation would be a little more complicated. I see that payroll is something I need to make more videos about so I'll address your situation in a more extensive payroll video.
