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What Is Payroll?

Payroll refers to every employee of a company who receives regular wages or compensation.
Payment methods are calculated by a payroll specialist and the appropriate paychecks are issued.
Staying organized is the best tip when dealing with pay periods that have different intervals with a set number of days.
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  • Edited By: Lindsay D.
  • Last Modified Date: 22 October 2014
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The term "payroll" encompasses every employee of a company who receives a regular wage or other compensation. Some employees may be paid a steady salary while others are paid for hours worked or the number of items produced. All of these different payment methods are calculated by a payroll specialist and the appropriate paychecks are issued. Companies often use objective measuring tools such as timecards or timesheets completed by supervisors to determine the total amount of compensation due each pay period.

After a payroll accountant multiplies an employee's hours by his or her pay rate, the gross income amount is entered into a calculator or computer program. Regular deductions such as tax withholdings, medical insurance, union dues, charitable contributions and so on are then categorized and subtracted. The remaining balance is then converted to a check or electronic deposit and becomes the employee's net pay for that time period. In the US, payroll departments also identify the employer and employees by a federal code and keep a running tally on total income and deductions for the fiscal year.

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For small business owners, keeping enough cash to pay all employees is often one of their highest priorities. Even if the business itself hasn't become profitable, employees must still be compensated for their services. This is why many smaller companies prefer to keep their payroll obligations as low as possible until they've reached a certain level of profitability. It's not unusual for small business owners to forgo their own salaries in order pay their employees.

Setting up an effective payroll system is not especially difficult for trained accountants, but it can be very time consuming. Some smaller businesses rely on user-friendly computer software to set up a simple system complete with check printers and file storage. Larger companies may assign trained accountants to handle pay issues as part of their overall duties. Businesses without the means to maintain their own systems often choose to farm out this task to outside specialists.

Since payroll records are based on objective criteria such as timecards and federal tax forms, outside accountants can perform all of the calculations, store all of the year-to-date data, and issue pay in a timely fashion. Employers simply need to update these companies with any changes in employee pay rates or deductions.

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Discuss this Article

anon341714
Post 81

What is offline payroll? I need the definition and its structure.

anon297167
Post 76

Can anyone recommend the best payroll software for use in Singapore?

anon212153
Post 71

This is Tanyi and I am preparing for HND in Accounting and have been asked to prepare a report on payroll. So I need some information regarding this payroll, like what does payroll actually mean, what does it contain and how to prepare a report. How should the questionnaire be prepared, etc.? Please, I need your help.

anon198495
Post 70

i need a payroll accounting project.

anon179612
Post 69

I am looking for a real payroll system that can exist in a bank. --ciamar

anon159689
Post 66

can you give me at least three specific problem in a payroll system? and what are the advantages and disadvantages of swipe cards? thanks

anon144377
Post 63

A payroll is just a title. It's amazing how people are obtaining degrees and don't even have common sense. This article has more than enough information for people of understanding.

This is my third semester in my final year of my associate degree, majoring in international business management. If you have jobs, I'm doing my best to take you out of that chair. I'm taking your job! Thank you for not letting me get intimidated now when I get to the work force.

anon143866
Post 62

Can you please provide information on different types of payroll systems and also recommend a system to use and why do you think i should use that particular payroll system? Thanks in advance, Anna.

naresh
Post 61

what is payroll, how can we calculate and tell me the process.

anon123366
Post 59

The company I use to work for started out really small. Each week they'd hand us personal checks at the end of each week instead of payroll checks. But since then things have taken off and we now have direct deposit.

anon123149
Post 58

This is janardhan. can i have complete information of payroll system and how it works?

anon122481
Post 57

This is joya. I am a computer science and engineering student 4th semester from national university of Bangladesh. Can you give me solution of this question elaborately? What is payroll? What is the advantage of this system? can you give me some examples of this system? Thanks.

anon115432
Post 55

I'm a business management technology student. And we are assigned to make a project proposal about payroll systems and it's hard for me to figure it out. Will you help me?

anon106702
Post 53

I have to do some work for my thesis. i need some information about a payroll system. Our thesis is about to code a program of the payroll system of the LBC company. In your own understanding what is a payroll system?

jiege
Post 51

I'm jiege and I'm a bsit student. i have a project about payroll. can you give some information or ideas on how to do it?. Thanks. I'm waiting for your help.

anon103814
Post 49

I'm a business management technology student. Can you teach me how to make a payroll system?

anon101403
Post 48

I'm jherwin, and it student. It's so hard to do a thesis, especially on a payroll topic. Please help me.

anon97277
Post 47

I'm Jane, a BA student. i wish to write a project on how a payroll system works. would you please give me the necessary guidelines to it. thank you.

anon91002
Post 44

this is prasanta. I am working for a small company. i just want to know the payroll system.

anon85836
Post 40

Please tell me how payroll works as an hr function.

anon83921
Post 39

I am jaswanth, pursuing my mba. can you provide for me the complete illustration about payroll system?

anon83407
Post 38

its me ashwini. I am studying master of business information and technology final year in my university. i need to do a project on payroll so may i get the payroll project?

anon80052
Post 37

can you give some examples in doing payroll system?

anon77320
Post 35

this is pavani studying mba fourth semester. i need a project related to hr(payroll). Please would you provide me? its a peak position for me. Please help me.

anon75890
Post 34

i need a project on pay roll system.

anon70118
Post 32

Can you please give the review of related literature about payroll? and specific problem of payroll using manual? Thanks a lot and more power.

anon69931
Post 31

can you give me an ER diagram of the payroll system?

anon66661
Post 29

I need a project on payroll.

anon65628
Post 28

what does payroll mean? does every company have to maintain this payroll expert?

anon63881
Post 26

please can you give me a thesis of a payroll system? i am in my second year in computer programming and i hope you will help me.

thanks and god bless.

anon61016
Post 25

could you give me a basic table of a payroll system? and space it correctly so that i could understand. Thanks! bunz.

anon59759
Post 23

i'm a computer science student. can you teach me how to make a payroll system and give some examples? Thanks.

anon59059
Post 22

how do I make a thesis in payroll system? --anne

anon54388
Post 20

I work as a lecturer in college. i just want to know what is actual pay roll, and whether employees get the salaries on bench or not.

anon49864
Post 18

please, i need your help on my project topic, "Developing a web base for a payroll of a company using a basic program."

anon48334
Post 17

can you give some example in doing payroll system?

anon48045
Post 16

what is a payroll system and a company payroll.

anon45453
Post 15

This is Santosh. I'm pursuing my MBA 2nd semester from matrusri pg college Hyderabad. My specialisation is in human resources. As i need to do a project to gain practical knowledge, I chose my topic as payrolls. so i need some information regarding this payroll i.e., what does payroll actually mean, what does it contain and how to prepare the report, how should the questionnaire be prepared etc. so please help me regarding my project. waiting for your reply.

anon43702
Post 14

I want to write a field report on payroll so I am asking for your assistance on introducing it.

medishetty
Post 12

Hi this is anil. i am working as an hr recruiter. i am interested in pay. can anybody suggest how to handle pay roll process?

anon38877
Post 11

hi. this is shivaraj. I am working for a small company. i just want to know the payroll system.

anon24901
Post 10

How can a payroll be motivational?

anon19672
Post 9

how to make an introduction of a payroll system?

anon19659
Post 8

So payroll and accounting & human resources are supposed to work together? I'm twisted...I'm doing research for school.

anon19565
Post 7

what is payroll system and how it works?

anon14455
Post 5

What is a payroll system?

Moderator's reply: check out our articles, what is payroll software? and what is payroll service? for more information on processing payroll.

anon13415
Post 4

This is Santosh. I'm pursuing my MBA 2nd semester from matrusri pg college Hyderabad. My specialisation is in human resources. As i need to do a project to gain practical knowledge, I chose my topic as payrolls. so i need some information regarding this payroll i.e., what does payroll actually mean, what does it contains and how to prepare the report how should the questionnaire prepared etc. so please help me regarding my project. waiting for your reply...........

nobreather
Post 3

even though a small business owner can figure out how to do payroll on their own, i think using a payroll service is a worthwhile idea.

in our state, there is lots of paperwork that needs to be filled out at different times of the year, and the small monthly fee that payroll services charge seems worthwhile.

outsourcing this sort of task allows you to focus on your business instead of focusing on things outside of your expertise.

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