Originally Posted On: Minute conversion chart: Payroll Time conversion | QuickBooks (intuit.com)
When you consider starting a business, the payroll process probably isn’t the first thing that comes to mind. Yet, every business needs a payroll process. When you run payroll, you’re ensuring everyone on your team is compensated for the work they’ve done.
While paying employees sounds simple, the process can get complicated. This is especially true for owners of very small businesses who run payroll manually. When you run payroll by hand, you typically have to convert employee timesheets to decimals to calculate wages. Converting minutes to decimals can be tedious work, which is why we’ve included a payroll conversion chart in this article. With a payroll conversion chart, you can quickly figure out minute to decimal conversions and improve accuracy when you run payroll.
To learn more about the payroll process and view our payroll conversion chart, keep reading. You can also skip right to the payroll time conversion chart or any other section using the links below.
Payroll refers to the process of compensating employees for their work. The payroll process includes tasks like calculating wages, deducting payroll taxes, and distributing wages to employees. The process also involves creating and updating payroll records and tax forms for future use.
Every company has to run payroll. Whether you’re the owner of a small business or a large corporation, payroll is an essential part of any organization. While payroll allows your employees to get paid, that’s not the only reason it’s important. Financial records can help you keep track of employee compensation, which is often a large part of any company’s budget. Plus, payroll taxes must be properly filed to keep your company in tax compliance and out of trouble with the IRS.
Running payroll isn’t a task that most small business owners look forward to. However, it’s crucial for every company to implement an effective payroll system. A good payroll system will ensure that your team is paid accurately and on time.
As far as how to do payroll, there are several different methods available to businesses. Each payroll solution comes with its own set of positives and negatives. The payroll system that’s right for your company depends on your particular business needs. Below, we’ve listed the methods most businesses use to manage and run payroll.
In a manual payroll system, all calculations are done by hand. This means that either the business owner or another employee is responsible for running payroll. You have to gather time cards, track employee hours, calculate wages, account for tax deductions, and so on.
The upside of a manual payroll system is that it tends to be inexpensive. You don’t have to purchase payroll software or contract with a payroll provider. And if your business only employs two or three people, then this payroll system may make sense.
However, as your team grows, it will become increasingly difficult to maintain a manual payroll system. As you hire more employees, more variables will come into play. Tracking hours and calculating gross pay for each employee will become more and more complex. Overall, a manual payroll process can be extremely time-consuming once you move past just a few employees.
Payroll software is a technological solution to running payroll. With this kind of software, you just have to enter a few key inputs and the program will do the calculations for you. By introducing automation into your payroll system, you can make the process more convenient for yourself. When you use payroll software, you no longer have to make calculations by hand. Instead, the program will automatically calculate employee wages, make necessary tax deductions, and generate pay stubs.
As opposed to manual payroll, payroll software is the more expensive option. However, QuickBooks Payroll offers a variety of service packages at affordable price points. With our payroll software, you can automatically run payroll, track employee time, protect your company from tax penalties, and access expert customer support.
Oftentimes, companies will outsource payroll management to an accountant. An accountant is a financial expert who can manage your payroll while ensuring you stay tax compliant. They can tell you the difference between Forms W-2 and 1099. You can consult them with questions you have about payroll expenses, taxes, and so on.
Alternatively, a lot of companies outsource payroll management to payroll service providers. A payroll provider is a company that specializes in managing payroll for other businesses. Generally, they charge a monthly flat fee or bill you every time you run payroll. If you want to spend a minimal amount of time and energy on payroll, outsourcing to a payroll provider can be a great choice.
As we mentioned above, a manual payroll system can quickly get complicated as your team grows. However, for some small business owners, a manual payroll process may make sense. Perhaps you’re working with a small team or you’re under tight budget constraints. In that case, a manual payroll system may be your best option.
Oftentimes, business owners using a manual payroll process have to convert the hours an employee worked into decimals. This can make it easier to calculate an employee’s gross pay. But those conversions can be tricky and open the door for all sorts of possible calculation errors.
For example, let’s say an employee works 27 hours and 14 minutes in a week. What does that number come out to as a decimal value? To get the answer, you have to divide the total number of minutes by 60. To get gross pay, you multiply that figure by the employee’s hourly pay rate. As you can imagine, doing this for every employee can get tedious. And entering even a single wrong number can result in an incorrect paycheck.
If you’re running payroll by hand, it can be a hassle converting minutes to decimals. To help you easily convert minutes to decimals, we’ve provided the payroll time conversion chart below:
If manual payroll just seems too overwhelming, then you might consider using payroll software or a payroll provider. Many small businesses eventually turn to these payroll solutions as they grow their teams. That’s because payroll software can automate the payroll process while giving you more accurate results. This frees up time for you to focus on the aspects of your business you’re most interested in.
Here are just a few things to consider as you search for the best payroll software for your business:
Every company needs an effective payroll system. You can run payroll by hand, use payroll software, or outsource your payroll process to an accountant or payroll provider. Manually running payroll is an inexpensive option, although it can quickly get overwhelming. Use our decimals conversion chart as an easy reference tool as you run payroll.
If you’re looking to upgrade your payroll processing system, look no further than QuickBooks Payroll. We offer a variety of different plans, so you can find one at a price that works for you. With QuickBooks, you’ll get features like auto payroll, tax penalty protection, time tracking, and same-day direct deposit. Whatever your business needs are, we can help.
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