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 | | From: | slyraymond | | Subject: | Accounting Idiot Question (SQL Ledger) | | Date: | Wed, 22 Dec 2004 13:29:50 -0600 |
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 | I'm learning to use SQL-ledger, which assumes a certain degree of accounting
knowledge, of which I have none.
I want to know if I am doing the following transaction correctly:
I brought in a family member to perform some labor for cash. So in the
general ledger I credited Petty Cash $60.00 (the cost of labor), then
credited the Wages & Salaries account $60.00. Is that right, or should I
first log an owner's contribution because the $60 came out of my pocket?
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| | From: | N Owen | | Subject: | Re: Accounting Idiot Question (SQL Ledger) | | Date: | Thu, 23 Dec 2004 22:08:17 -0600 |
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| On Wed, 22 Dec 2004 13:29:50 -0600, slyraymond
wrote:
>I'm learning to use SQL-ledger, which assumes a certain degree of accounting
>knowledge, of which I have none.
>
>I want to know if I am doing the following transaction correctly:
>
>I brought in a family member to perform some labor for cash. So in the
>general ledger I credited Petty Cash $60.00 (the cost of labor), then
>credited the Wages & Salaries account $60.00. Is that right, or should I
>first log an owner's contribution because the $60 came out of my pocket?
>
>
Proper entry should be credit owner's contribution and debit contract labor
- wages & salaries should be reserved for payments that you are going to
withhold payroll taxes from. Also, you will probably want to check out the
IRS guidelines on "Is this person an employee?"
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