Paid salary to gopal journal entry is Salary Expense Account Debit This increases the salary expense account, reflecting the cost incurred for paying salaries, Credit to Cash/Bank Account This decreases the cash or bank account balance, reflecting the payment made for the salary. When a business pays salary to an employee, it needs to record this transaction accurately to reflect the decrease in cash and the recognition of salary expense.
Key Concepts
- Salary Expense: The account representing the cost of salaries paid to employees.
- Cash/Bank Account: The account from which the salary payment is made.
Journal Entry for Paid Salary to Gopal
Example Scenario
Assume a company pays a salary of ₹30,000 to Gopal on 30-09-2023.
Step-by-Step Journal Entry
- Record the Salary Payment
| Date | Account Title | Debit (INR) | Credit (INR) | Description |
|---|---|---|---|---|
| 30-09-2023 | Salary Expense | 30,000 | Salary paid to Gopal | |
| 30-09-2023 | To Cash/Bank | 30,000 | Payment of salary to Gopal |
Explanation
- Debit to Salary Expense: This increases the salary expense account, reflecting the cost incurred for paying salaries.
- Credit to Cash/Bank: This decreases the cash or bank account balance, reflecting the payment made for the salary.
Conclusion
Accurately recording salary payments is essential for tracking expenses and maintaining precise financial records. Properly managing these transactions helps ensure that the business’s expenses are accurately represented in the financial statements, contributing to better financial management and reporting.