 In this presentation, we will create the payroll expense journal entry from our payroll register to our general journal posted to the general ledger and then create the trial balance. So we're going to pick up our information here from the payroll register. We're going to go to the second tab over here. This is going to be where the journal entry will be implemented. So we're going to have our journal entry as of nine one into the general journal here. We'll then post it to the right to our general ledger and then that general ledger will be used to create the trial balance. So the first thing we want to do is just consider how we're going to construct the journal entry. If it was a very simple journal entry for payroll, the most simple journal entry would be we're just paying someone cash for payroll. That would be a debit to payroll expense and a credit to cash. So you can imagine that easiest journal entry would just be like any other type of expense that we pay. We're going to pay cash. We're going to credit cash. We're going to debit expense for the payroll expense because that's what we paid the cash for to the employees. We're still going to have that we're going to say that the cash is going to go down here but we want to and we're still going to have a payroll expense as well. So those are two components still in place. However, we're going to have to also pull out money for all the other stuff that we got to take out of the paycheck, which will include the payroll taxes and those will be liabilities. So if we go back to the payroll register, then we're going to basically be mirroring what happens from the total earnings here minus all the deductions. So that total earnings minus all these areas in red. So the deductions for OASDI, HI, FIT, insurance, union dues, 401k, that'll give us the net check. So this is really what we're looking at. This minus all of this to get to that. So we're going to start. I'm going to go back to our journal entry tab and we'll start with the expense. That will remain the same. It's going to be payroll expense. Here's payroll expense and so we're going to copy that. It's going to be a debit account. Expenses go up in the debit direction. We'll do the same thing to it. Another debit. So we will right click on that and copy, scroll back up top and we're going to put that in B5, right click and paste 123. Now the amount's going to come from the register. I'm going to do that with a journal entry and go to this other tab and pick up the amount. So we're just going to say equals. We're going to do this with a formula. I should say equals. We're going to go back to our tab over here and we're going to pick up the amount of total earnings, 48, 896 and enter. So that's going to be it. Now the other thing that's going to be affected is cash, but it's going to be like our bottom line number. So instead of starting with cash, we're going to note that cash will go down, but it's going to be at the end. Note too that it is possible that we run payroll at a different time than we actually process the paychecks. So we could be putting it to payroll payable and some texts or books or processes will do that and then pay cash later. But we're just going to put it to cash here so that we can see how it kind of similar, it's similar to the most basic journal entry, which would be a debit to payroll expense and a credit to cash. So before we credit cash, however, we're going to have to pull out all the stuff that we're not going to pay to the employees. And we have to put them into liability accounts because we don't get to hold them. It's not revenue to us. We have to pay them. We owe them to the government typically. So we're going to go back to our total, our register and that's going to include OASDI, Social Security, H.I., Medicare, Federal Income Tax for the employees, the employees, Federal Income Tax, any other withholdings like group insurance, union dues, 401k plan, we got to take all that out. So we're going to go back to our journal entry. We're going to do that with a credit so to a liability account. So that'll include the FICA, OASDI, the FICA for the H.I., and I'm holding down control. I'm letting go and holding down control because it's not going to include FIT or FUTA. I mean, because that's going to be a employer only tax. I'm holding down control. It will include FIT, group insurance, union dues. I'm scrolling down a little bit holding down control again and retirement plan. So all of these are going to be things that we're going to pull out. We're just going to put that in our journal entry with credits. So I'm just going to copy all these, right click and copy. We're going to put that up top in B6, right click and paste 1, 2, 3. Now we're going to enter the credit amounts from our register. We're going to do that with a formula. They will be credits. I'm going to represent them with a negative. To do that, we're going to say put our cursor in E6 instead of hitting equals, we're going to say negative and then go back to our register and we're going to pick up the OASDI in N9 and then enter and it'll just pull that over. We're going to do the same thing for HI. Instead of equals, we're going to say negative, go back to our register and we're going to pick up that 708.99 in HI and enter. Same thing for FIT. Instead of equals, we'll say negative, go back to our earnings record and we're looking for FIT, picking up FIT and enter. And then the group insurance, same thing. We got our cursor in E9. We're going to say negative, go back to our earnings record, go to the group insurance and enter. Then the union dues, we're going to be saying negative, go back to our earnings records, to the union dues and enter. And then the 401k or retirement plan, we're going to say negative, go back to our register and pick up the 401k and enter. Okay, so now our debits don't equal our credits. The credits add up to 20,689 and the debits add up to 48,896. So we're going to need a credit for the basically the plug to make this fit, make this work. And that will be if we go back to our register, it should be the net pay. However, I'm going to do that. I like to just figure that out. I'm going to go back to the journal entry by doing our negative sum function and figuring this number out and then checking to see if it's the same as the net check. To do the kind of the plug formula, the negative sum formula will be instead of equals negative, SUM will double click the sum function and highlight these cells. And then that should take the difference and then flip the sign so that we get that negative 2826611. If we go back to our register, we could see that that should be our number here, 2826611. All right, and I'm going back to the journal. That should be going then to cash. So we're going to say cash is where that goes. I'm going to copy that and paste cash as our last account here. Now note that if it was we could have gone to accounts payable or not accounts payroll payable as well. If it was a payroll account, and we're going to pay later, but we're going to put it to cash here. Now we're going to go ahead and post this to our general journal. So a general ledger. So to do that, I'm going to first freeze the pains. So we're going to go up to AD one, we're going to go to the view tab. And this is just one way to make it a little bit easier. If not, it's just a little bit more scrolling to do if we can't freeze the pains. Then we're going to go to freeze pains and freeze pains. So it's in the view tab windows freeze pains. Now when we go to the right, the pains will stay in the same area. Now if we scroll down, we're looking for this 502 first. That's way down here on the expenses. So it's going to be in the same order on the GL assets, liabilities, equity, income and expense. So we're going to go to the right looking for that expense. So we've got the assets and then the liabilities and orange and then equity. And then we're looking for that expense, which is payroll expense down here in BM. So I'm going to say it's on nine one. And we're going to be in cell B and 18 and cell B and 18. And we're just going to say that that equals and pull over this 4896. So we'll say this equals, and we're just going to pull over this 48896, which will increase the balance to 48896. So that's that's what we have here. Now you could just type in, I would put a formula equals D5. And that'll pull over the information. Then if we just go to the left side of the frozen pains and scroll right, we'll see that that number should be picked up right here on the trial balance as well. And of course, we're out of balance by that same number. Net income has gone down by that expense. So net income is the revenue minus the expenses went down in the debit direction. Revenue minus expenses has gone down. Okay, next item, we're going to have the 5215 here. It's going to be a liability. It's our third liability. So that's where we're going to. It's going to be assets up top. And then we're looking for the liabilities. And here it is 215. Once again, the date is 91. We are in 86. Within 86, we're going to say equals point to the 3031 50 and enter. So there's the 3031 50. If we go right to the left of the frozen pains and scroll right a bit, we see it here as well. Then we're going to go to the 220. So 220 is here. FICA 220 here. We'll go to the right and see the same area on the general ledger. Here's the FICA 220 hi, which is Medicare date 91. Then we're in a x six within a x six, we're going to say equals and point to that 708 99 to give us that number. Then we'll go right to the left of the frozen pains, scroll right, and we'll see that 708 99 here as well. Then we're going to go to the 225. Here it is 225 225 on the trial balance. And we're going to scroll right and see if we can find this 225. So here's 223. Here's 225. And so we want to be in BE seven. And so we'll say 91 tab. And we're going to say equals and pick up the 8008 5 899 13. So here's that number. We go right to the left of the frozen pains and scroll right. We can see that same number here on the FIT liabilities increasing. Then we're going to go to 243. We're looking for account 243. So we scroll to the right. Looking for account 243. So if we scroll down a bit here it is on that BE 21, we're going to say 91 BE 20 BF 21. We're going to say equals and point to that 243 bringing the balance up to we're going to point to that 5500 bringing the balance up to 5500 and depending going right to the left again and scrolling right we're going to see that picked up on the trial balance as well. Then we'll go to the union dues. So 245. I'm going to scroll over to find 245. It's going to be a liability. So 243. Here's 245 should be up top. Dates going to be 91. So then in BJ six we're going to say equals and we're going to point to that $16 bringing the balance up to 16. Then if we go right to the left of the frozen pains and scroll right we see that 16 here. Then we're going to go to 247. 247 weighed down here last liability accounts. So we'll scroll to the right to find that last liability account retirement and here it is. So it's in BI 21. We're going to say 91 within BJ 21 we will say equals and point to that 2774 20 bringing the balance up to 2774 20 then if we go right to the left and scroll right we see that same amount here then we just need the checking account. So here's the checking account in 100. It's going to go up top first account. We scroll to the right. So if we're in AK six we're going to say 91 and then in AL six we say equals and point to that 28266 11 bringing the balance down from 600,000 by 28266 to 571 733. Okay scrolling back to the right we then see this information here. All of our liability accounts have now gone up for FICA Social Security FICA Medicare and FIT Federal Income Tax Troop Insurance Union dues retirement. Those are all things that we're going to have to pay to the government or to whoever were responsible to pay them to at some point in the future. Then we've got the payroll expense increasing which brings net income down. Note what we do not have. We don't have payroll taxes expense here. Payroll taxes expense is not going up because even though we're withholding taxes it's all part of the employee's wages. These aren't payroll taxes to us the employer. We will record payroll taxes in another journal entry and those will be things that we have to pay out of our bank account not out of the paycheck of the employees.