Keeping detailed accounting records for your business is important for many different reasons. For one, your books hold a wealth of information about the financial state of your business. You can learn a lot about your operations and make smart decisions by looking at the right data.
Accounting reports provide an overview of important financial information in an easy to understand format. There are different types of accounting records that each tell different stories about your business.
Here is why an Income Statement (or Profit and Loss Statement, as it’s also known) is important and what information it includes.
When you start to keep financial records for your business, you’ll need to decide what method of accounting to use. There are two choices – the cash method (also known as cash basis accounting) and the accrual method (accrual basis accounting).
Here are the differences between these two accounting methods and what to consider when deciding which method is best for your business.
As a business owner, you have a lot to juggle. And it’s likely you are constantly keeping an eye on your bank account to see how much money you have available. But how do you know if you’ve received all the funds from each day’s sales? Did the merchant processor transfer the payments that were due for that day? Were cash deposits made by your manager on time?
For most business owners, getting paid quickly is critical. It can also be extremely difficult. We have all experienced the frustration of investing time, energy and funds into a client job only to be left spending more time which is your margin following up on collections!