Small business bookkeeping tips teach you how to set up all your accounts in a Chart of Accounts and maintain them so you are running the business and the business isn’t running you!
In our previous article on setting up a Chart of Accounts, we gave you five simple steps to follow. Did you do them? Great. If not, be sure to check out our series of foundational posts on Small Business Bookkeeping Tips.
You may written down all your categories in a notebook. Now it’s time to create those categories in an accounting system. We like Outright.com because it’s very easy to use and creates incredible management reports (including pie and bar charts) with just one click. It’s more intuitive than QuickBooks. While QuickBooks may be the standard, Outright is easier, super-compatible, and gets number-phobic people off the couch.
Step 1: Go to Outright.com.
One of the best small business bookkeeping tips we’ve ever given is get to know Outright.com. It is free for one month, after that it’s $10.00 per month and you can cancel at any time.
The drop down menu will ask you to input your revenue and expense categories. Just fill in the blanks by copying your categories from your notebook you created from reading our last post. Find tips here. Shouldn’t take much time.
Step 2: Managing Receipts.
Get an expandable file. I know it’s low tech. So what? It works.
Put your expense categories on each tab. You’ll be filing the receipts from expenses you incur during the year in this file. One new expandable file for each year.
Any expense that is directly related to your business could be written-off the business income at the end of the year. Only your accountant knows for sure. You’ll want to save all your receipts just in case. If you incur an expense, make sure you put the purpose on the receipt first before you file it.
I try to be efficient in my filing system. All receipts are put in one envelope until I can enter them in Outright or QuickBooks and then file the paper in the expandable file by the end of the week. I schedule the time to enter these receipts each week.
Step 3: Filing Receipts
There are those paperless enthusiasts who use Neat Receipts to scan all their receipts and file them electronically. I still like to keep the paper version, just in case.
I gather all my receipts and file them weekly after I’ve accounted for those expenses in my bookkeeping software.
Verizon bills get filed under “phone,” Electric bills get filed under “utilities.” If you have to pay for water, it might go under “utilities” as well.
Last, I keep all the bank statements and credit card statements for the business in the expandable file too. Any bank withdrawal or deposit tickets also get filed with the statements monthly.
When the bookkeeper comes in to make sure all the files are up to date and to reconcile the bank statements at the end of the month, it requires a lot less cost and time.
If you do this, you won’t lose your mind around tax season.
Step 4: Look At Your Reports Monthly
Now that you’ve entered all your revenues and expenses this month, how much money in revenues did the business generate? What did you spend on phones in the last three months? How about rent?
With the simple click of a button, Outright.com will provide you with all the reports your heart desires. I like to create pie charts with pretty colors. The contrast helps me see comparisons in expenses. Bar charts help me see trending over time.
Small business bookkeeping tips are here to help you order your chaos so you can spend your time where it matters most, with customers.
If you’re looking for more help with bookkeeping or other small business questions, check out our small business training videos. You’ll learn everything you need to run your business like a pro. And if you get stuck, hit the Panic Button. Experts are ready to help you whenever you need it.
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