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Chapter 12
Chapter 13
Chapter 14
Chapter 15
Chapter 16
Chapter 17
Chapter 18
Chapter 19
Chapter 20
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Chapter 22
Chapter 23
Chapter 24
Chapter 25
Chapter 26
Chapter 27
Chapter 28
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Running Payroll

Pay check generation XE "pay check Generation"  should be tested before it is needed.  The Payroll icon gets us directly to the Select Employees to Pay window.  But if we click, on the menu bar, Activities|Payroll|Pay Employees, we get to the same place, and also have access to other payroll activities.  From the QuickBooks 5 Navigator, Payroll and Time tab, select Create Paychecks.  Take the time to see what each box says, before proceeding.

The illustrations are from QuickBooks Pro versions which include time tracking.  Non-Pro versions will show less information. 

To be printed has an obvious action if checked. If it is blank, the pay check will be assigned the next manual check number, as described in Chapter 5.

Bank Account is obvious, if you have only one. Fortunately it is remembered, when the next pay checks are written.

Check Date shows the date that will be on the checks, and also means that you should check the date, because it is not on the Preview Paycheck window.

Enter hours and ... should be checked, until you are ready to take off the training wheels and click Create check without preview ... .

Pay Period Ends can seem perverse.  It will go to the next pay period for that certain active employee with the earliest last-paid date. If an employee is no longer with the company, be sure to fire him by entering a release date on his employee record.

(b) column does what one would expect, and I suggest starting by marking one employee.  The Mark All (or Clear All) button on the right has an equally obvious function. 

Employee and the other columns are not accessible in this window.  Hours will show time entered through the time tracking feature (QuickBooks Pro.)  Rate and Hours can be adjusted in the next window.  Last Date is the from the most recent previous pay check for this employee.

When it looks correct, click Create.

Preview Paycheck XE "Preview Paycheck"  window carries a full load of data.  Slow Down!   The little boxes in this window tell where your money (and your employees money) is going.  Before pressing the OK, be sure you understand the reason for each amount being what it is and where it is.  Any section may have more information available by scrolling down.  The Employee Summary window shows a blank on the last line, but actually has more lines available by scrolling.  This window does not show the check date; it was on the previous window.

Earnings takes in payroll items (annual salary, hourly wage rates, sick and vacation pay items.)  If the employee is paid hourly, check for correct hours, and adjust if necessary.  A salary payroll item will show a pay periods worth of salary.  If this box contains a Class column, and some numbers are not displayed, see the Windows chapter, under Display Problems.

Item column lists items coming from the employee record, as defaults.  Changes are possible.

Rate comes from the employee record, but can be changed.  A payroll preference allows hiding of the rate.

Hours will appear, if previously recorded.  If time tracking is not used, hours will be entered here.

Customer:Job is for billing time to a customer.

Service Item will be used on the invoice, for this time.

Additions, Deductions, and Company Contributions lists any of these items attached to this employee.  A bonus may be brought in as a commission.  In older versions, this works for salary charged to a second account.  An addition item could be used, but must be at the top of the list, so that it will be subject to any percentage deductions. These lines may be edited on this screen, if necessary.

NOTE CAREFULLY!!

The order of payroll items in this box is critical.  Pay calculation follows these rules:

1. Commissions (if listed) are first added to gross pay, regardless of position in this table.

2. Additions, Deductions, and Company Contributions take effect according to their order in the table.  As an example, consider a deduction based on a percentage of gross pay, followed by an addition to gross pay.  The percentage deduction will not be taken from that addition.

Complex pay situations should be set up carefully, considering this.  The first two or three pay checks should be verified by manual calculation.  QuickBooks will do what it is told, but will understand the instructions on its terms. (Yes, this is repeated, for the benefit of those who missed it in the previous chapter.)

Company Summary lists the company contributions for this employee.  In the illustrated case, clicking the down-arrow found some more items.

Employee Summary lists all the amounts adding to and subtracting from the employees net income.

Sick Available and Vacation Available are display only, and may be changed by editing the employee payroll record.

Skip button will appear at the bottom, if several employees were selected to be paid.  If someone has displeased you today, here is your chance.

Thepay check XE "pay check"  will be generated if OK is clicked.  The pay check record is different from ordinary checks.  Going to the check register, selecting the check, and clicking Edit, we see the check generation window has lost one letter and is now called Review Paycheck .  When the check is printed, the location of information on the check blank and voucher is also special for pay checks.  However, the same check blank is used for printing all checks, so printing is as discussed in the Chapter 5.

Hand-written pay checks  XE "pay checks:hand-written" may be used.  A pay record may be printed from File|Print Forms|Print Paystubs.   The pay stub is printed in landscape orientation on letter-size paper.  Fonts may be changed from Forms|Printer Setup|Paystub printer.

Editing pay checks (or deleting them) is  XE "pay checks:editing" possible, from the check register. Caution is required; read on. 

Historical record checks also require special attention.  The user must understand how year-to-date (YTD) figures are determined.  When a check is written, all existing checks, for that year, are scanned.  The YTD values are the sum of all amounts, already recorded, for any date in the year.  If later pay checks are recorded, and then checks with earlier dates, the earlier dated checks will have incorrect YTD figures.  However, once a check is written, the YTD figures are not accessed, unless the check is edited again.

The bottom line:  YTD figures work fine, as long as pay checks are issued in the usual manner.

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Last modified: May 21, 2004