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The accounting for salaries paid to employees involves journal entries for salaries expense and salaries payable. When employees perform work, the employer debits salaries expense and credits salaries payable. Salaries expense reduces net income, while salaries payable increases current liabilities on the balance sheet. Additional complexities arise from factors like payroll taxes, union dues, and federal income tax withholding, which must be accounted for separately. When the employer pays the employees, salaries payable is debited, and cash is credited. Payroll accounting is more intricate due to these factors.
