Payroll Advances

[Darryl Buckle]

I'm having a payroll advance issue. Employee has been issued an advance but for that month the liabilities now shows a credit. This is not possible since big brother always wants his money. what have I done wrong?

[aturner]

Check the account associated with the advance payroll item. This should be an asset account, since it is money that the employee owes to the company.

Hope this helps.

[Joey]

Your employee advances account needs to be a current asset type of account. When you loan him the money, charge that account with the loan. Then link your employee advance payroll item to go to that asset account. It sounds like you have it linked to a liability account now. When you deduct the money from the employee, it will reduce the amount he owes you.