A payroll clearing account is used to transfer the exact amount necessary to cover payroll checks and related expenses.

Question

Quizplus · Accepted Answer

A payroll clearing account acts as an intermediary account between the company's general account and the payroll account. It only holds funds necessary to cover payroll checks and related expenses, and any excess funds are transferred back to the general account. This ensures that there are no discrepancies or overdrafts in the payroll account.

A Payroll Clearing Account Is Used to Transfer the Exact