Bookkeeping is a necessary chore of all businesses, helping you manage your operations and prevent an audit by giving the IRS what they need. To keep moving toward your long-term goals and improve profits, get your small business accounting in order with these essential tips:
Separate Business and Personal Expenses – Having a dedicated business bank account, including checking and a credit card, saves you precious man-hours when it’s time to tally up deductible expenses.
Track Every Expense – Label and categorize each expense, and track your cash flow.
Accurately Record Deposits – Loans, revenue from sales and other cash infusions are easy to lose track of, and that can lead to paying unnecessary income taxes.
Understand When It Pays to Pay – Hiring a professional bookkeeper or accountant, even for just a few hours a week or month, can make a big difference.
Dedicate Time to Update Your Books – Block out weekly time in your calendar to get necessary paperwork in order and avoid letting receipts and invoiced receivables pile up.
Keep Tabs on Labor Costs – Paying employees, including yourself, may be your largest expense. Take note of overtime, perks and other benefits you offer to prevent over- or under-paying.
Expect Major Expenses – Computer upgrades, equipment replacement and tax deadlines shouldn’t come as a surprise.
Maintain Inventory Records – Avoid misplacing merchandise – or theft – by noting dates purchased, stock numbers, purchase prices, dates sold and sale prices.
Follow Up on Invoices and Receivables – Avoid overpaying on taxes and hours spent sifting through your revenue account and receivables listing by circling back with vendors who owe you money.
Courtesy of Fundera
For more information contact Neikirk, Mahoney and Smith at 502-896-2999