To process payroll, one starts by collecting the hours each employee has worked during the pay period. This is followed by calculating the gross wages, considering hourly rates or salaries and any overtime or bonuses. Deductions are then made for federal and state taxes, as well as any other withholdings, such as health insurance or retirement contributions. After all the calculations, employees are paid their net salary either by direct deposit, checks, or other payment methods. Proper records should be maintained, and tax filings should be submitted to the appropriate government entities.