9A 3 Accounting
Terms
Gross Pay
The pay an employee receives before any deduction
Owner's Equity
The rest of the company's assets
Liability
The amount owed
Assets
Anything owned by a company that has a value
Formulas
Hourly Pay: $12.50 Hours worked: 42
Overtime Pay = 12.5 x 1 - .5 = 18.75
Weekly Pay = (40 x 12.5) + (2 x 18.75) = $537.50
Net Pay = Gross Pay - Deductions
Assets = Liabilities + Owner's Equity
Employees
Forms of getting paid
Salary
Salaried employees are paid based on a weekly, monthly or annual salary. They are designated this way because their responsibilities are not related to the time spent on the task. It does not increase or decrease with extra or fewer hours.
Hourly
Some federal regulations establish which employees should be paid per hour. An employee should complete 40 hours of work, any extra hours worked should be paid at a rate not less than time and one half their regular rates of pay
Types of Companies
Corporation
Owned by a large group of people
Sole Proprietorship
Owned by only one person
Partnership
Owned by 2 or more people
