ADP Payroll Accounting and Reconciliation

Question 1

What is the purpose of a payroll journal entry in ADP and which accounts are typically affected?

Accepted Answer

To record the payroll expense, tax liabilities, and net pay; accounts include Wages Expense, Payroll Tax Expense, FICA Payable, Federal Income Tax Payable, and Cash

Answer

To record only the net direct deposit amounts to the Cash account

Answer

To update the general ledger with benefit invoice amounts

Answer

To record workers' compensation premiums

Question 2

In ADP, which module or feature maps payroll data to the employer's general ledger accounts?

Accepted Answer

ADP General Ledger (GL) Interface

Answer

ADP Direct Deposit Manager

Answer

ADP Time & Attendance Sync

Answer

ADP Benefits Enrollment Module

Question 3

What is payroll reconciliation and how frequently should it be performed?

Accepted Answer

The process of comparing payroll register totals to tax filings, bank statements, and the general ledger; it should be performed each pay period and at quarter-end

Answer

An annual audit of all employee W-2 forms by a CPA

Answer

The process of verifying direct deposit confirmations only

Answer

A monthly comparison of benefit carrier invoices

Question 4

When reconciling payroll, what does a variance between gross wages on the payroll register and wages on Form 941 typically indicate?

Accepted Answer

A missed adjustment such as a correction, voided check, or non-taxable wage exclusion that was not properly recorded

Answer

A system glitch that requires ADP support

Answer

An employee was paid twice in the quarter

Answer

The wrong tax rate was applied to supplemental wages

Question 5

What is the role of an 'accrued payroll' journal entry at month-end?

Accepted Answer

To recognize wages earned but not yet paid by the end of the accounting period in the company's financial statements

Answer

To record direct deposit confirmations in the cash account

Answer

To post benefit deductions to the carrier's account

Answer

To reverse prior period payroll tax deposits

Question 6

In ADP, what is the purpose of the Payroll Summary Report when conducting an end-of-period reconciliation?

Accepted Answer

To provide totals for gross pay, deductions, taxes, and net pay by employee and department for reconciliation against the general ledger

Answer

To list all employees who received overtime during the period

Answer

To detail individual direct deposit bank transactions

Answer

To show benefit enrollment changes for the period