Business Bookkeeping Discussed
“The bookkeeping record should be maintained on a regular basis, preferably a weekly one. The amount of time and effort required after each week will not be much and things will be easily manageable. ”
Owning a small business is no child’s play and bookkeeping is no exception in this regard. There are two ways to do things. One is to keep on accumulating invoices, payables and other accounting paraphernalia until it’s time to pay your taxes.
This method is sure to fail because tax calculation requires accurate facts and figures and piled up things usually produce only haphazard ones. Your paperwork will be tremendous and you may have to face the ire of the officials and may even have to shell out a huge amount as penalty. This in itself defeats the purpose of a small business where the profit is limited.
The second method is to develop a system for the management of your financial gear. The first thing to do is to maintain a detailed record of your expenditure and income.
This record should be maintained on a regular basis, preferably a weekly one. The amount of time and effort required after each week will not be much and things will be easily manageable.
Make categories and sub categories of all your expenditure and income. This categorization is usually required for expenditure section and is of a great help while calculating your tax.
Various kinds of forms are available for this purpose and can be downloaded from the Internet free of cost. But they have one disadvantage. They are not a custom fit for our business. So, you have to strike out the irrelevant columns and that makes things untidy.
So, either have your own forms or find out that material that worked well for the business similar to you. For example, if you run a service business of some sort, your form need not have the categories and subcategories related to transport, receiving and inventory.
You would have to leave all these categories blank and that would not seem presentable and professional. Therefore, a customized bookkeeping form is the correct alternative.
Use a computer software like the spreadsheet so that you can transfer all the relevant entries to your budget without any kind of botheration. It would be as easy as copy paste work and would help you in having control over your budget and hence your money.
Author - DeeKay
Tags - Finance, Economy
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