@smpri
The response above is going to put you in the same situation: -$400 expense + $300 deposit - $100 check = -$200.
I think the solution here is to create a $0 paycheck (instead of $100) for the employee because it's the $100 paycheck that's throwing off the balance since you didn't give that to the employee. The only two transactions that are hitting your bank account are the $400 payment and the $300 deposit, correct? If so, assign your payroll wage expense account to both of those transactions, create the $0 paycheck to get the withholding correct and you should be all set.
Create a zero net paycheck
