Partial Month Calculations

[Sujit Shah]

I would like to hear from people who have experience in developing
software for payroll:

If a person works from 01/01/09 to 23/05/09 and his/her wages are
$48000 per annum.

Would his/her earnings be:

(A)
$4000*4+23/31*$4000=$12000+$2967.74

or

(B)
$4000*4+23/365*$48000=$12000+$3024.65 (Non Leap Year)

$4000*4+23/366*$48000=$12000+$3016.40 (Leap Year)

Is there a general consensus/ common practice on this?
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[Sujit Shah]

Sorry my bad it should read:


(A)
$4000*4+23/31*$4000=$16000+$2967.74

or

(B)
$4000*4+23/365*$48000=$16000+$3024.65 (Non Leap Year)

$4000*4+23/366*$48000=$16000+$3016.40 (Leap Year)
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[Robert McKeever]

Depends. If it is a monthly salary, then (A) is correct, save I'd use  
working days in the month (16/21).

If it is truly annual, then calculate the working days for the year  
and pro-rate accordingly.

On Jun 15, 2009, at 5:53 PM, Sujit Shah wrote:

> I would like to hear from people who have experience in developing
> software for payroll:
>
> If a person works from 01/01/09 to 23/05/09 and his/her wages are
> $48000 per annum.
>
> Would his/her earnings be:
>
> (A)
> $4000*4+23/31*$4000=$12000+$2967.74
>
> or
>
> (B)
> $4000*4+23/365*$48000=$12000+$3024.65 (Non Leap Year)
>
> $4000*4+23/366*$48000=$12000+$3016.40 (Leap Year)
>
> Is there a general consensus/ common practice on this?
> **********************************************************************
> Register for 4D Summit 2009 Today
> Early Bird Pricing Ends August 28th - http://www.4d.com/summit
>
> 4D Internet Users Group (4D iNUG)
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_________________________________________
Bob McKeever                      http://www.mswl.com
McKeever's Software Wizardry
Maple Ridge, B.C.
bobmckeever@...



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[Sujit Shah]

 Depends. If it is a monthly salary, then (A) is correct, save I'd use
> working days in the month (16/21).
>
> Yes that too! Really complicates things if you start using working days.
Public Holidays et all. Interesting to see that there is a big difference
which ever way you go.
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[Kirk Brooks]

Sujit, I've done a few payroll apps in the past. There are a number of
issues to be aware of beyond the simple mathematics of the computations. In
your example the answer is also affected by whatever the payroll policy of
the company is. There is likely a policy covering such an occurrence. Also,
as someone else mentioned, the pay period the employee is paid under matters
and all of that may be superseded by an employment agreement.

You may have already done this so forgive me if it sounds like I'm talking
down to you - that's not my intent - but you may want to take a look at the
IRS docs governing payroll (at the least read the Circular E). I also found
it helpful to download feature lists from other payroll packages. These are
a good checklist of capabilities you may want to build in or talk over with
your client to see which ones they need.

As far as "common agreement" take a look at a current copy of GAAP
(Generally Accepted Accounting Principles). Writing your app to be
consistent with GAAP is always good practice.

Hope this helps.

On Mon, Jun 15, 2009 at 5:53 PM, Sujit Shah <sujit.au@...> wrote:

> I would like to hear from people who have experience in developing
> software for payroll:
>
> If a person works from 01/01/09 to 23/05/09 and his/her wages are
> $48000 per annum.
>
> Would his/her earnings be:
>
> (A)
> $4000*4+23/31*$4000=$12000+$2967.74
>
> or
>
> (B)
> $4000*4+23/365*$48000=$12000+$3024.65 (Non Leap Year)
>
> $4000*4+23/366*$48000=$12000+$3016.40 (Leap Year)
>
> Is there a general consensus/ common practice on this?
>

--
Kirk Brooks
San Carlos, CA
=======================
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