Rno (Accountant) (71 Points)
25 November 2015hi,
i have a doubt regarding the wages. we have taken an employe to work at work site ( not our office staff ). inorder to pay the salary . which entry to be passed. whether i need to show it in Wages head in trading account or Salary head in P&L Account?? if the advance wage is paid. how to pass entry?? Please help,
Manikanth
(Chartered Accountant)
(342 Points)
Replied 25 November 2015
In my opinion you can treat it as wages.
Accounting Entries for advance wage :
1) Advance Wage A/c Dr (Current asset)
To Bank A/c
(Being advance wage paid to xxxxxx (person name) )
2) If you want to create Provision at due date of payment:
Wages A/c Dr (Indirect expenses)
To Wage Payable A/c (provision)
(Being Wages payable on xxxxxx(month ending date) )
3) When Payment of wages made:
Wage payable A/c Dr
To Bank A/c
To Advance Wage A/c
(Being Wages Paid and advance amount of wages adjusted)
Rno
(Accountant)
(71 Points)
Replied 25 November 2015
thanks for the reply. so it is under head Wage in trading account , ryt???
Rno
(Accountant)
(71 Points)
Replied 26 November 2015
thanks Mr. Manikanth have stated that wages - indirect expense. wages to Direct expense is ryt?
Manikanth
(Chartered Accountant)
(342 Points)
Replied 26 November 2015
Manikanth
(Chartered Accountant)
(342 Points)
Replied 26 November 2015
Manikanth
(Chartered Accountant)
(342 Points)
Replied 26 November 2015
Sorry, wages is direct expense
Rno
(Accountant)
(71 Points)
Replied 08 December 2015
hi,
we also took travelling expense to that employee for project work, So which head it must accounted. direct or indirect ??
Rno
(Accountant)
(71 Points)
Replied 08 December 2015
but its apart from salary which we have paid, which head??
GST Live Certification Course (39th Batch) - April 2024 (Weekend Batch) (With Certificate)
"Live class on Python for Financial Analysis: Unlocking Efficiency in Accounting and Finance"
CAclubindia
