WHAT IS PAYROLL?
What does it give to businesses? According to an online dictionary a payroll is a list of a company's employees and the amount of money they are to be paid. Imagine a business without any system in giving salary of it people; it would become a big chaos especially to big business. A payroll calculates the amount you are obliged to pay your employees based on factors such as the time they worked, hourly wages, and whether they took vacation or holiday during the period. The gross pays adjusts by subtracting taxes and other withholding amounts. The employees are given a paper wherein it indicates the information on haw their wage and deductions are done during the month.
What does it give to businesses? According to an online dictionary a payroll is a list of a company's employees and the amount of money they are to be paid. Imagine a business without any system in giving salary of it people; it would become a big chaos especially to big business. A payroll calculates the amount you are obliged to pay your employees based on factors such as the time they worked, hourly wages, and whether they took vacation or holiday during the period. The gross pays adjusts by subtracting taxes and other withholding amounts. The employees are given a paper wherein it indicates the information on haw their wage and deductions are done during the month.
Payroll that are not given on time in small businesses are noticeable easily. Sometimes, if payrolls are given in an untimely manner some employees tend to under perform their work because they question the integrity of the company. These people depend their financial stability in these companies, a protocol should be followed so as not to let their employee question them.
The person doing the payroll for the business should devote their time and consistency in this job. The information being encoded should be accurate in all times hence giving the employees the right wage. In small business, the owner should outsource to this job to free up his time.
Payroll can be traced back to 7000 BC. The payrolls were carved into stones. Archaeologists found evidence of this. Back in the fifth century the Greek used a system that resembles our payroll system today. They kept records of payments and carved them into stone. The payroll that we use today came about during the 19th century. The workers were increasing and they needed a way to track the payment of workers. It was when the word payroll was first used. The first computerized payroll system was used in the 1950’s. Overtime payroll has developed into something complex. Companies need to track what they are buying, selling and of course tax: they also need to track the payment of their employees. With hundreds of employees it is easier to keep track using payroll to avoid confusions and errors.
Why is payroll important? Like in many big companies, payroll is important even in small or start-up companies. Every small business owner performs more than one role for his company. One of the most important tasks in running a small business is completing payroll. Employees need to be able to rely on being paid on a consistent basis without delays. Delays may give negative feedback to the company through the word-of-mouth. Word-of-mouth is a very powerful tool because it may destroy the company's reputation. Payroll affects every aspect of a small business, from the morale of employees to the financial stability of the company.
Why is payroll important? Like in many big companies, payroll is important even in small or start-up companies. Every small business owner performs more than one role for his company. One of the most important tasks in running a small business is completing payroll. Employees need to be able to rely on being paid on a consistent basis without delays. Delays may give negative feedback to the company through the word-of-mouth. Word-of-mouth is a very powerful tool because it may destroy the company's reputation. Payroll affects every aspect of a small business, from the morale of employees to the financial stability of the company.
One of the most important aspects of payroll is its impact on the morale of employees. In a small business, employees tend to be more aware of the company's financial stability than in a larger business. If payroll is late, employees will start to question the financial integrity of the company. This might reflect the performance of the company or the business. This will also cause employees to start underperforming and to care less about their job if they feel it is not secure. This might also give out negative ideas to other businesses or your competition. Payroll should always be paid in a timely manner to keep employee morale high.
Payroll can be a time consuming job for a small business owner. This job needs to be performed consistently once or twice a month. In addition, the information needs to be correct so that employees are paid the right amount, the withholdings are accurate, and state and federal tax deposits are made timely. The right amount is of course, deserved by the employees, no matter how small or big your company is. To be able to do this efficiently, a small business owner should consider outsourcing this job to free up his time.
Why is Payroll Important?
Morale
One of the most important aspects of payroll is its impact on the morale of employees. In a small business, employees tend to be more aware of the company's financial stability than in a larger business. If payroll is late, employees will start to question the financial integrity of the company. This will cause employees to start underperforming and to care less about their job if they feel it is not secure. Payroll should always be paid in a timely manner to keep employee morale high.
Compensation
Another important characteristic of payroll is that it allows an employee to feel his net worth within a small company. An employee's total compensation is built into payroll. This includes his salary, benefits and bonuses. Employees typically undergo annual performance evaluations by their supervisors and are rewarded with an increase in salary or a bonus or both. Benefits also reflect an employee's worth within a small business. Employees who receive health insurance, life insurance and pension benefits feel they have a higher worth.
Consuming Job
Payroll can be a time consuming job for a small business owner. This job needs to be performed consistently once or twice a month. In addition, the information needs to be correct so that employees are paid the right amount, the withholdings are accurate, and state and federal tax deposits are made timely. To do this efficiently, a small business owner should consider outsourcing this job to free up his time.
Lowers Tax Bills
A final important aspect of payroll is that it needs to be done right to lower state and federal taxes for a small business. Small business owners should make sure that employees fill out their W-4 withholding forms correctly. The information on these forms is used to withhold personal taxes for employees. Owners should also ensure that they are withholding the proper amount of FICA taxes each year from payroll. FICA percentages can change yearly based on legislation.
DO YOU LOVE ANSWERING PAYROLL PROBLEMS? HERE YOU GO!
1 1. Esther makes money by commission rates. She gets 30% of everything she sells. If Esther sold P150, 000 worth of items this month, what is her salary for the month?
Given: Amount sold = P1, 250,000
Percentage rate = 30%
Find: Salary for the month
Equation: Total salary = Amount sold × Percentage rate
Solution: P150, 000 × (30 / 100)
Answer: P 45,000
2. In a regular week, there are 5 working days and for each day, the working hours are 8. Jenna gets P 2.40 per hour for regular work and $ 3.20 per hours for over-time. If she earns P 432 in 4 weeks, then how many hours does she work for?
Given: Working days per week = 5 days
Regular working hours per day = 40 hours
Normal wage rate = P2.40 per hour
Over-time wage rate = P3.2 per hour
Total weeks worked = 4 weeks
Total earning for 4 weeks = P432
Find: Work Hours
Equation & Solution: The total normal working hours for 4 week:
= 4 x (Working hours per week) = 4 x 40 = 160 hours
Wages for normal work for 160 hours:
= 160 x (normal wages per hour) = 160 x 2.4 = 384 $
Wages for over-time:
= (Total earnings) - (Wages for normal work) = 432 - 384 = 48 $
Over-time hours worked:
(Wages for over-time)/ (Over-time wage rate)
= 48/3.2 = 15 hours.
Total hours worked:
= (Normal working hours for 4 week) - (Over-time hours worked)
= 160 + 15 = 175 hours
Answer: Jellie works for 175 hours.
3. 3. Angelica makes money by commission rates. She gets 21% of everything she sells. If Angelica sold P35, 000 worth of items this month, what is her salary for the month?
Given: Amount sold = P35, 000
Percentage rate = 21%
Find: Salary for the month
Equation: Total salary = Amount sold × Percentage rate
Solution: P35, 000 × (21 / 100)
Answer: P7, 350
4
4. Elyza’s gross pay for the month of June is P33, 350. His deductions are SSS Premium, P80.20; withholding tax, P70.52; & Medicare P15.50. Find his net pay.
Solution:
Gross Pay P 30,350.00
Deduction
SSS Premium P80.20
Withholding Tax P70.52
Medicare P 15.50 P 166.22 -
Answer: P33, 283.78
5 5. An employee in a candy factory is paid P30 for every 15.0 g candy she packs. In a day, she is able to pack 50 15.0 g candies. How much is her gross pay on that day?
Solution:
Gross Pay = Amt. per pc. Produced x No. of pcs. Produced
= P30.00 x 50
= P1,500.00
Answer: P1,500
6.Tom had 120 teddy bears in his toy store. He sold 2/3 of them at $12 each. How much did he receive?
Solution:
Step 1: find the number of teddy bears sold.
He sold 80 teddy bears.
Step 2. Find how much money he received.
80 x 12=960
He received $960
1. Martha spent 4/9 of her allowance on food and shopping. What fraction of her allowance had she left?
Solution:
Simplify:
4. There are 32 gems in a necklace and ¼ofthemare brown. How many of the gems are brown?
5. Tim practices 6/7 hour of soccer each day for 3 days. How many hours of soccer did he practice in total?
11. Maria makes money by commission rates. She gets 15% of everything she sells. If Maria sold P 23,000 worth of items this month, what is her salary for the month?
Solution:
Amount sold = P 23,000
Percentage rate = 15%
Total salary = Amount sold ×Percentage rate = P 23, 000 × (15 / 100) = P 3, 450
12. Tiffany makes money by commission rates. She gets 21% of everything she sells. If Tiffany sold P 27, 000 worth of items this month, what is her salary for the month?
Solution:
Amount sold = P 27, 000
Percentage rate = 21%
Total salary = Amount sold ×Percentage rate = P 27, 000 × (21 / 100) = P 5, 670
13. Cindy makes P 9, 000 a month plus some money by commission rates. She gets 10% of everything she sells. If Cindy sold P 30, 000 worth of items this month, what is her salary for the month?
Solution:
Amount sold = P 30, 000
Percentage rate = 10%
Salary from commission rate = Amount sold ×Percentage rate = P 30,000 × (10 / 100) = P 3, 000
Total salary = Base salary + Salary from commission rate = P 9,000 + P 3,000 = P 12,000
14. Paul makes a base monthly salary of P1500. As a vendor, he must sell P20000 worth of items per month. He also makes a 4% commission on all sales beyond the monthly quota. If Paul sold P26000 worth of items this month, what is his total salary for the month including base salary and commission to the nearest Peso?
Solution:
Amount past quota sold = Amount sold - Monthly quota = P 26, 000 - P 20, 000 = P 6,000
Amount made from commission = Commission Rate ×Amount past quota sold = 4 ÷ 100 ×
P 6,000 = P 240
P 6,000 = P 240
Total amount made = monthly base salary + Amount made from commission = P1500 + P240 = P1740
15. Peter makes P 7,000 a month plus some money by commission rates. He gets 6% of everything he sells. If Peter sold P 55, 000 worth of items this month, what is his salary for the month?
Solution:
Amount sold = P 55, 000
Percentage rate = 6%
Salary from commission rate = Amount sold ×Percentage rate = P 55,000 × (6 / 100) =
P 3,300
P 3,300
Total salary = Base salary + Salary from commission rate = P7000 + P3300 = P10300
16. Aaron makes money by commission rates. He gets 15% of everything he sells. If Aaron sold P15, 000 worth of items this month, what is his salary for the month?
Given: Amount sold = P15, 000
Percentage rate = 15%
Find: Salary for the month
Equation: Total salary = Amount sold ×Percentagerate
Solution: P15, 000 × (15/ 100)
Answer: P2, 250
17. Jo makes P 20,000 a month plus some money by commission rates. He gets 5% of everything he sells. If Jo sold P 60,000 worth of items this month, what is her salary for the month?
Amount sold = P 60000
Percentage rate = 5%
Find: Salary of the month
Solution: Salary from commission rate = Amount sold ×Percentagerate = Solution: P 60,000 × (5 / 100) = P 3000
Total salary = Base salary + Salary from commission rate
Total salary = Base salary + Salary from commission rate
P20,000 + P3000 = P23,000
18. Amor makes P 70,000 a month plus some money by commission rates. She gets 15% of everything he sells. If Amor sold P 50,000 worth of items this month, what is her salary for the month?
Amount sold = P 50,000
Percentage rate = 15%
Percentage rate = 15%
Find: Salary of the month
Solution: Salary from commission rate = Amount sold ×Percentagerate = Solution: P 50,000 × (15 / 100) = P 7,5000
Total salary = Base salary + Salary from commission rate
Total salary = Base salary + Salary from commission rate
P70,000 + P7,500 = P77,500
19. Karyle makes a base monthly salary of P 30,500. As an artist, she must sell P20,000 worth of items per month. She also makes a 6% commission on all sales beyond the monthly quota. If Karyle sold P 36,600 worth of items this month, what is his total salary for the month including base salary and commission to the nearest dollar?
Solution: Amount past quota sold = Amount sold - Monthly quota
P 36,600 – P 20,000 = P16 600
Solution: Amount made from commission = Commission Rate ×Amountpastquotasold
Solution: Amount made from commission = Commission Rate ×Amountpastquotasold
6 ÷ 100 × P 16,600 = P 996
Solution: Total amount made = monthly base salary + Amount made from commission
Solution: Total amount made = monthly base salary + Amount made from commission
P 30,500 + P996 = P31,496
20. Char makes money by commission rates. She gets 30% of everything she sells. If Char sold P50, 000 worth of items this month, what is his salary for the month?
Given: Amount sold = P15, 000
Percentage rate = 30%
Find: Salary for the month
Equation: Total salary = Amount sold ×Percentagerate
Solution: P50, 000 × (30/ 100)
Answer: P15,000
References:
www. payroll-solutions.co.uk
http://smallbusiness.chron.com/meaning-payroll-system-61432.html
http://smallbusiness.chron.com/importance-payroll-23271.html
