| Accounting scares a lot of people, so much that | | | | cash from a party; you would increase cash and |
| they just avoid it. But accounting really doesn't | | | | decrease sales, shipping, and taxes. The line should |
| have to be scary if you just know the basics. For | | | | equal 0. You can easily set your spreadsheet up |
| anyone that is running a business, I highly | | | | to calculate it. Then, to enter the purchase of the |
| recommend taking a beginner accounting class | | | | product from your company, you would decrease |
| somewhere, or one geared towards small | | | | cash, and increase purchases, shipping, taxes. This |
| business. There are some things that it is helpful | | | | is where an accounting class comes in, it will help |
| to know. | | | | this make sense. |
| First of all, you need to record transactions. You | | | | One of the disadvantages to this system is that it |
| don't need big fancy software to keep track of | | | | cannot print off a report when it comes to tax |
| your accounting; any spreadsheet program will fit | | | | time, whereas accounting software can help you |
| your needs just fine. You just need to be able to | | | | with that. But, if you keep your books current, |
| keep track of numbers in a column, and add them | | | | you can easily pull the numbers you need for |
| up. If you prefer paper, go out and find a | | | | your taxes. |
| columnar accounting book, or you could even use | | | | You should also be comparing your credit card |
| a notebook and draw lines. | | | | and your bank balance to this file occasionally. If |
| Each column should be labeled for various items. | | | | the two don't match, you need to figure out why |
| Columns would have various headings like cash, | | | | and adjust as needed. Bank fees and interest are |
| credit card, sales, purchases, shipping, and | | | | two things that can commonly cause balance |
| whatever else you may need. You can always | | | | issues. |
| add more columns later as your business gets | | | | These are some very basic accounting principles. |
| bigger (this is why a spreadsheet is easier). | | | | An accounting class will explain these in more |
| I recommend the double entry system, so that | | | | detail and help you understand them better. |
| each line zero's out. For instance, you receive | | | | |