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Released April 2011, ProfitGauges is the simplest yet most efficient accounting program for your trucking business.

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WAGES entries vs RETAINED EARNINGS

Hi there, I have two questions....

1. When I enter "wages" for two employees we have, should I enter the actual amount they get to deposit after taxes we pull from their paychecks? Should I use gross or net value here?

2. I'm also not sure if maybe I should use RETAINED EARNINGS for entering those wages, since those two employees I'm talking about is me and my husband...

and even there, do I enter gross or net value?

3. And what about all the taxes, all of the unemployment taxes and withholdings we put away each month? Where do I enter that if I do get to enter that?

Hope you can help.

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Hey there,

First off GREAT QUESTIONS. Hope this helps you out.

  1. When entering wages for employees you'll want to enter the full cost of having that employee. That would be the GROSS which includes the total amount of money paid for taxes and such for the employee.
  2. Since the two employees are you and your husband it would actually be better to use Retained Earnings so your reports look correct. However if you did enter as wages just remember that the reports are AFTER you've paid yourself so your PPM (profit per mile) and CPM (cost per mile) will be off so never compare with others when talking PPM since the majority of single truck owner operators do not pull their own wages out to get their PPM.
  3. With the taxes that you pay for staying in business I'd definitely add those under taxes since that is a cost of doing business.

If you're still a little confused or in need of more information please do not hesitate to contact us at support@letstruck.com or (855) 800-FUEL

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OK so here's another question. I know some taxes are deductible and some aren't... like state taxes, medicare and social security taxes are and federal aren't... so when I enter actual paychecks under retained earnings (my husband and I are only employees), then should I enter Gross amount or just what I deposit after taxes being paid and then enter taxes paid under TAXES deduction (only the ones that qualify)?

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Jeremy & Katherine - Remember, retained earnings are only on your settlements. If you're paying yourselves outside of your settlement then I'd only add the tax the company paid for having you as an employee. You wouldn't deduct the taxes that you as an employee has to pay though. ONLY THE COMPANY'S PORTION. I hope that makes sense.

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I know it's an ongoing question here, I'll give you an example may I? I won't be using actual numbers or values and percentages... just plain numbers.

Lets say we pay ourselves $1000 a month gross, so of course we have to pay state taxes (let's say $30), federal withholding taxes ($100), and SS and Medicare, where we pay $10 SS and $15 Med, and company pays $10 SS and $15 Med as well to match. So total of taxes paid mount is $180. So we deposit total of $820. So now I know fed withholdings are not deductible as a company tax expense, but I know state and SS and Med can be entered under TAXES in profit gauges, right? So what number do I enter under retained earnings? Is it $820 that we actually deposit? Or the total gross which would be $1000? That's where I'm stuck. I just want my reports to reflect proper numbers. And that's where I'm little lost.

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You would add the tax portion of the payroll into Taxes and then the payout from your company to you would be the difference. So in this case you'd want $820 in wages and $120 in taxes. I would recommend create a sub of Taxes named "Payroll" and then in the sub of Wages have it the name of the driver or Jeremy...

Hope this helps out a little.

Aaron Yount

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what's the $120 sum of? I promise this is the last question

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