Provident fund

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

03 November 2011 Dear All,

I have some query with respect to provident fund accounting

1.what are the ledgers to be create for provident fund
2. under which group in tally
3.give journal entry

Please send the reply to my mail ID: sakthivel135@gmail.com

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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03 November 2011 When salaries are paid to the employees, employer deducts the employee's share of provident fund from salary and net salary (after PF) is paid to the employee.

Employer's own contribution as well as deducted amount from employees salary are deposited for a specified period with the proper authority.

When salary is paid, the following entry is passed:-

(Assume salary is Rs. 5000 , deduction from employee's salary Rs. 500, & employer contributes equal amount)

Salary Ac --------------------------------5000Debit
Provident Fund (liablity Ac)-------------- 500Credit (Will be reflected in each individual employee's salary on credit side)
Bank / Cash ------------------------------ 4500Credit

Employer's contribution's entry will be

Salary Ac ---------------------------------500Debit
Provident Fund ( Liablity Ac)--------------500Credit

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