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Saturday, April 9, 2022

Keeping Track of Expenses

There are two very important aspects for a successful business. One is revenue and two is keeping track of costs. Many business owners work diligently on the first and neglect the second. In this day and age of computerization, there is no excuse for not keeping track of expenses. 

 


There are many good programs that are cost effective, even for the smallest business.

The best overall is  QuickBooks Online, the best for Micro-Business Owners is Xero, the best for Service-Based Businesses is FreshBooks; the best for part-time freelancers is QuickBooks Self-Employed and the best free software is Wave.

All these software programs are modestly priced and easy to use with some training and practise. 

Many small business owners use a personal credit card to buy both make both personal purchases and business purchases. This can be a headache come end of the business year and tax time.

A simple solution to attempting to cull business purchases from personal items is a to keep a a box the size of a shoe box (or a shoe box) in your office. 

 


For every purchase made for a the company whether the purchase is made by credit card, debit card or cash, make sure you get a receipt and place it in the box. 

At the end of the month, separate them into categories (IE Gas, coffee, meals, parking, etc), circle each one on the credit card statement, make a copy of the statement and place that and the receipts in a folder. When you do your bookkeeping, enter each one as an expense and bingo, no problem with your accountant of the tax man.