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Quickbooks is calculating employee wage total incorrectly, only with hours ending in decimals or in minutes. How do I fix this error?

For example, when an employee works 32.58 hours or 32:35 at $15 hour, the quickbooks total comes out to $488.75 but our outside payroll company comes up with $488.70. This error occurs with all hourly transactions ending with decimals or in minutes.  I am only using payroll in quickbooks to manually keep track of expenditures for our company. I am wondering if this is an error that can easily be fixed.

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Best answer 12-10-2018

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BRC
Established Community Backer ***

When I create a new paycheck and enter 32.58 hours and $1...

When I create a new paycheck and enter 32.58 hours and $15 per hour, I get $488.70.

But, when I change my time preferences to minutes, then...

When I create a new paycheck and enter 32:35 hours and $15 per hour, I get $488.75.

This is because .58 of an hour and 35 minutes are not the same thing.  35/60 = .583333333333333333.... of an hour, which QB rounds to .58333

$15 * 32.583333 (or 32 and 35/60's) is $488.75 exactly.

Whereas 58/100's of an hour is just that:

$15 * 32.58 is $488.70 exactly.



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17 Comments
Highlighted
BRC
Established Community Backer ***

When I create a new paycheck and enter 32.58 hours and $1...

When I create a new paycheck and enter 32.58 hours and $15 per hour, I get $488.70.

But, when I change my time preferences to minutes, then...

When I create a new paycheck and enter 32:35 hours and $15 per hour, I get $488.75.

This is because .58 of an hour and 35 minutes are not the same thing.  35/60 = .583333333333333333.... of an hour, which QB rounds to .58333

$15 * 32.583333 (or 32 and 35/60's) is $488.75 exactly.

Whereas 58/100's of an hour is just that:

$15 * 32.58 is $488.70 exactly.



View solution in original post

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That's what I thought it was at first so I changed the se...

That's what I thought it was at first so I changed the settings from minutes to decimals but got the same total. I would like to post a picture to show you from my computer but it will not let me on here.
BRC
Established Community Backer ***

You can attach a picture to your question or an answer, b...

You can attach a picture to your question or an answer, but (for some reason no one knows) not to a comment (which this is.)
Established Community Backer ***

"I did change it to decimals but I still came up with the...

"I did change it to decimals but I still came up with the same answer."

In that image, you had not yet Tabbed out, so the amount bottom right is not yet updated. What happens when it Updates?


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I tabbed out and it still stayed the same. Also, I can no...

I tabbed out and it still stayed the same. Also, I can not change the total in 'Employee Summary' either. Thanks for your help!
BRC
Established Community Backer ***

What's your current time format in QB?  When you tab out,...

What's your current time format in QB?  When you tab out, how to the hours appear?
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The time is in decimal format, when I tab out the format...

The time is in decimal format, when I tab out the format stays just like this: 32.58 for hours. Is that what you meant?
BRC
Established Community Backer ***

In decimal format you should get 488.70, I would think....

In decimal format you should get 488.70, I would think.  I do.  Have you tried closing and restarting the check?
Also, be sure to enter the time in the current format to be sure to see the effect of the current time format.  If decimal, then enter decimal.  If minutes, enter minutes.  It doesn't seem like it should matter, but it might.
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dmatz- If your Preference is Decimal, and you enter 32:35...

dmatz-
If your Preference is Decimal, and you enter 32:35, QB will change the display you see to 32.58, BUT, to calculate the gross pay QB will use 32.58333 because QB had to convert your "minutes" entry so it will still be 488.75. If you look at the Payroll Summary Report you will see exactly what "hours" QB used.
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Big Red Consulting is exactly right. The calculation res...

Big Red Consulting is exactly right.

The calculation result depends on your "Display Preference" setting, and how you enter the hours.
With a Display Preference of "Decimal", if you enter 32.58, QB calculates $488.70, using only the .58 of an hour to make the calculation.
With a Display Preference of Decimal, if you enter 32:35, QB converts to decimal to calculate the gross pay and converts the 35 minutes to .58333 of an hour. So in this calculation QB is using 5 decimal places so the gross pay is 488.74995 rounded to $488.75.

If you look at the Payroll Summary Report you can see exactly what "hours" were used.

Since your payroll Company is calculating $488.70, set you Preference to Decimal and enter 32.58, not 32:35.

Established Community Backer ***

The setting we are asking you to confirm is: Edit menu >...

The setting we are asking you to confirm is:

Edit menu > Preferences, General, Company Preferences tab. Set this to Decimal.

Enter and use the same data your Payroll Provider offers in their reporting.

Not applicable

For some reason it is not changing the total. I am contin...

For some reason it is not changing the total. I am continuing to get the same total even though the setting are set up correctly.
Established Community Backer ***

No two systems calculate the same, so you need to use the...

No two systems calculate the same, so you need to use the same method they use = decimals, not minutes. For Manual Payroll, you are inputing everything, so input the same info.

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I did change it to decimals but I still came up with the...

I did change it to decimals but I still came up with the same answer. I attached a picture to the question.
Community Contributor *

Re: In decimal format you should get 488.70, I would think....

Where in QuickBooks do you go to change to the decimal format?

 

Thanks,

Angie Jordan

Established Community Backer ***

Re: In decimal format you should get 488.70, I would think....

@ajordan65

 

It's in this topic, already: Edit menu > Preferences, General, Company Preferences tab

Community Contributor *

Re: In decimal format you should get 488.70, I would think....

Thank you!!!!

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