What Is Wage Payable?

Labor remuneration payable by an enterprise in accordance with the provisions of the labor system and not paid to employees, including basic wages, regular bonuses and various allowances.

The reason why wage payable is a liability of an enterprise is that the date of payment is inconsistent with the balance sheet.

In practice, the wages of enterprises during the current period are usually paid at the beginning of the next period.

Before the wages have been paid, the unpaid wages actually constitute a debt to the employees.

According to the accrual basis principle, at the end of each accounting period, the enterprise must pay the wages which have not been paid to the employees according to the wage standard at the end of the month, which should be reflected as a current liability at the end of the balance sheet.

The calculation of wages payable mainly includes two aspects: wage settlement and allocation of wage expenses.

The basis for wage settlement in accounting department includes: the staff, labor and wage departments pferred to the staff recruitment, attendance, mobilization, wage level adjustment and wages and allowances changes notice and relevant departments pferred to the buckle payment notice.

When confirming wage costs and payable wages, the accounts of "production costs", "manufacturing costs" and "administrative expenses" shall be debited separately for different purposes of payable wages, and the accounts payable payable shall be credited.

When wages are paid, the accounts payable payable are credited to the "bank account" or "cash" account.

Sometimes, in accordance with the law or by the relevant parties, or in order to facilitate the staff and workers, the enterprises will deduct some items from the total wages payable to the employees in the month. The most typical deducting item is to deduct the personal income tax of the workers. In addition, there may be withholding rent, water and electricity charges, telephone charges, staff housing fund and so on.

These deducted items will form the current liabilities of the enterprises before they are delivered to the parties concerned.

Withholding items can be accounted for through other accounts payable or other receivable accounts.