Pf & esi calulation and procedure in manufacturing company

PF is calculated on Basic and DA @ 12% for both employee and employer contribution. Employer contirbution is shown as 8.33% and 3.67% .Along with 12% employer contribution you need to pay 1.61% as admin charges ( 0.50%, 1.10 % , 0.01% on 12% contribtuion). So the total amount paid is 25.61% of the basic and da every month before 12th of the following month.

ESIC is paid on Gross amount of salary - Employee contribution is 1.75% and employer contribution is 4.75% of the gross, this has to be paid 18th of following month in which salary has been done.

The respecitve journal entries are

1. Salary account ...dr

Outstanding salary account/bank account ...cr

PF Payable (amount of employees contribution)......Cr

ESIC Payable (amount of employee contribution)...cr

2. PF Employer contribiton ......dr

ESIC employer contribution....dr

PF Admin charges.....dr

PF payable (amount of employer contribuion+ admin charges)......cr

ESIC Payable (amount of employer contribution)....cr

3. PF Payable (employee contribtuion , employer contribution and admin charges)....dr

ESIC ( employee contribution, employer contribution) .....dr