October 30, 2016 admin

Profit Sharing Accrual

Liabilities and Net Worth

NON US PROFIT SHARING ACCRUAL LIABILITY ACCOUNT
2450

ACCOUNT EXPLANATION
Estimated amount of employe profit share to be paid by the dealer, based on the percentage established by Mexican Law.
TRANSACTIONS
  Jrnl. Dr. Cr.
  Monthly estimate of employe profit sharing CD
    Profit Sharing Application 9910
      Profit Sharing Accrual 2450
             
  Annual payment of employee profit sharing CD    
    Profit Sharing Accrual   2450  
      Cash in Bank—Payroll     1002
COMMENTS
  • Net liability on this account is computed on corporate annual Dealers Net Profit. Monthly provisions will be made on a year to date net profit basis, adjusting balance to proper year to date calculation.
  • A supporting schedule should be prepared for control and management review.