Human Resource Information System (HRIS) maintains the records of the employees and calculates the number of salaries and wages payable to them. It sends a list of workers to the Manufacturing Department. The Manufacturing Department on the basis of this information prepares a report on the performance of each worker and deductions to be made from their wages if any. Thereafter, this report is sent to both Accounts Department as well as to Human Resource Department. After this, the Human Resource Department sends the report to the Accounts Department to pay the wages.
The Accounts Department with the help of these reports calculates the amount payable and statutory dues and subsequently, makes the final payments to the workers. The report of the final payments is sent to the HR Department and the Manufacturing Department by the Accounts Department.
Relationship between MIS and HRIS (Human Resource Information System)
HRIS provides MIS with information such as the qualifications, skills, experiences, and past performances of an individual employee. MIS in turn uses this information to make appropriate decisions. This helps in placing the right person with the right qualities in the right job positions. This also helps in taking decisions regarding promotions and increments of the employees.
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Interest on Capital
Any interest paid on capital is considered as an expense and is shown in the Profit and Loss Account. Treatment of interest on capital in the final accounts is as follows.
Interest on Drawings
Treatment of interest on drawings in the final accounts is as follows. Firstly, interest in drawings is shown on the credit side of the Profit and Loss Account.
What is Operating Profit?
Operating Profit can be defined as the profit earned by carrying the normal business activities. It is computed by subtracting the operating expenses from the gross profit.
Balance Sheet
The balance sheet is the last financial statement that is prepared by any organization. This statement helps to ascertain the true financial position of an enterprise at the end of an accounting period
Profit and Loss Account
A profit and Loss Account is the second financial statement prepared by an organization. This account is prepared to ascertain the net results of a firm in form of net profit earned or net loss incurred during an accounting period.
What are Adjusting Entries?
In order to incorporate adjustments in the financial statements, we pass the required Journal entries, which are termed as adjusting entries.