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Small Business Bookkeeping: 3 Steps to Success

Why track YOUR finances?  What are YOUR Reasons and Goals?  I want to know my bank balance, how much money I have in the bank.  I want to pay my bills on time, not late or missed.  I want to simplify and save time preparing my tax returns. I want to make a budget and follow it.  I want…What do YOU want?  Spend a short time to write down YOUR reasons and YOUR goals.

Which set-up is best for YOU?  Where and How to Start?  You want to design a simple, easy system that helps you reach YOUR goals.  Do you prefer using Paper or using a Computer?  A computer can SAVE TIME after initial setup and learning.  First month is a bear, but trust me, it’s worth it.  If you choose a computer, then which software program do you choose?  QuickBooks is my favorite, but you could use Quicken or other software.   Whether you use paper or computer, you start with lists of names: bank & credit card account names, categories of income and categories of expenses.  You will also have Customer and Jobs on a list and Vendors on another list.  If someone is both a Customer and a Vendor, be careful to keep them separate.  I suggest adding (Cust) and (Vend) after their names on the different lists.  Think about these ideas and talk with other business friends about what they use.  Then choose one and just do it.

Implement YOUR system & carry throughYou choose whether to enter your financial data daily, weekly or monthly.  This will depend on YOUR goals.  You need to do it at least monthly, probably when you get your bank and credit card statements.  You want to reconcile your statements within 30 days after you get them.  Banks make mistakes once every 3-5 years, but you want to catch that mistake ASAP which is WHY you reconcile.  After you reconcile, print your monthly Profit and Loss so you know how much you earned and spent.  This will help you make your business more profitable.  BACK UP YOUR DATA every time you enter data, unless you’re willing to re-enter the data again if it gets lost.

Conclusions.  You will see how easy it is to track your finances.  You will save valuable time & eliminate stress, especially preparing your tax returns next year.  You can focus better on your products and services to others.  You will have CONFIDENCE in your financial records.  Congratulations.  

©2011, Linda Qbq Russell, QBQueen.com

2 comments to Small Business Bookkeeping: 3 Steps to Success

  • Yes, it is so important to track your finances. It makes life so much easier when budgeting, planning for trips, and tax time. A cool tip I heard the other day for entrepreneurs is to run your business like a business! This means don’t mix personal and business finances. This week I’m keeping things separate. Look forward to reading more of your tips!

  • Thanks a ton for posting this, I observed it quite informative, and it answered most from the concerns I had.

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