Basic Bookkeeping For Small Business Owners
Bookkeeping Basics for Owners
Many small business owners and startup entrepreneurs are great at creating products and services, managing people, and establishing and maintaining customers and suppliers. Many of them however,throw up their hands when it comes to basic bookkeeping. Unfortunately, a small business owner has to wear many hats. As the business owner, if you don’t understand some basic bookkeeping and what information either you or your bookkeeper-accountant should be supplying you with in order to run a successful business you're doomed. You need to know everything about your business’s finances, not just your bank account balance. Why ? Proper information helps you to make good business decisions and plan for the future.
This "mini" tutorial is designed to provide owner's with a basic understanding of bookkeeping and what you need to know to run a successful business. With this knowledge you won't be "snowed" by a an incompetent bookkeeper or accountant and will be able to discuss and understand accounting information with your bookkeeper or accountant.
A kind note from one of my site visitors sums it up nicely.I am a tired and retired small business consultant. The biggest problem I faced was that business owners didn't understand anything about their accounting. The worst part is they were too embarrassed to admit it.
My goal is to fix this !
What you as an owner need to know about Bookkeeping !
- Source Documents
- Accounts
- Financial Statements
- Management Reports
What you as an owner don't need to know about Bookkeeping !
Assuming you have a bookkeeper or accountant (internal or external) !
- What Debits and Credits are and how they are used to record transactions.
- What Special Journals are and how they are used to record transactions.
- How to invoice and record Customer Sales Invoices
- How to prepare and record Sales Orders
- How to prepare and record Purchase Orders
- How to record Supplier Invoices
- How to record Cash Receipts and Cash Payments
- How to pay employees - outside payroll services can handle this task at a reasonable price
In other words basically the recording processes.
Lastly, What System - Manual or Computerized ?
This decision should be a no-brainer !
If you have not yet computerized your accounting, you should seriously consider doing so. Most of the software being offered has a trial version that you can use to see if it fits your needs. Also, there are now many free excellent accounting software solutions being offered.
Many business owners think bookkeeping is a big headache, but if you understand and use the data your bookkeeper or accountant provides, bookkeeping can be your best friend by helping you to have a successful profitable business.
Download or Print my Free Basic Bookkeeping for Owners PDF as a reference and to use to study offline.
More Meat On The Bone
For those wanting additional guidance or more in depth explanations, I recommend my So, you want to learn Bookkeeping ! tutorial and my Quick Bookkeeping Insights.
Money Tight ?
Free Help is available ! If you need help with your bookkeeping or just want to run your business more effectively, contact SCORE today to get paired with a mentor !