Preparing the Books for a Small Business

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Basic Bookkeeping for Your Small Business

Bookkeeping refers mainly to the record-keeping aspects of accounting. Bookkeeping is essentially the accounting process (some would say the drudgery) of recording all the information regarding the transactions [more…]

Examining End-of-Period Bookkeeping Procedures

Even if all transactions during the year (or other business period) have been recorded correctly, the business's accounts still aren't quite ready for preparing the financial statements. Additional procedures [more…]

The Importance of a Bookkeeping Audit Trail

Good business bookkeeping systems leave good audit trails. An audit trail is a sequence of events leading up to a bookkeeping entry in your business's accounts. You start with the source documents and [more…]

Adjustments to Net Income for Determining Cash Flow from Operating Activities

Debtors, stock and prepaid expenses are operating assetsused in the profit making process. Creditors and accrued expenses payable are operating liabilities [more…]

Getting to Grips with Bookkeeping: The Current Ratio

The current ratio compares your current assets to your current liabilities, providing a quick glimpse of your business’s ability to pay its bills. The formula for calculating the current ratio is [more…]

Stricter Bookkeeping Methods: The Acid Test Ratio

Many lenders prefer the acid test ratio when deciding whether to give you a loan because of the test’s strictness. Stock isn’t included in calculating the ratio. [more…]

The Flow of Credits and Debits in Double-Entry Bookkeeping

In double-entry bookkeeping you enter all transactions in the books twice: once as a debit and once as a credit. To keep your debits and credits straight follow this table which shows you how both impact [more…]

Building Blocks of a Bookkeeping System

The following three elements make up the essential foundations of bookkeeping. Keep these business basics in mind when you set out to create a bookkeeping system: [more…]

Key Steps to Keeping the Books

Bookkeeping involves following a set procedure of major stages. Take a look at these steps that detail the processes involved – from start to finish in the bookkeeping sequence: [more…]

Making Accounting Adjustments to Reach Profit Potential

Having your business reach a profit is important; if it doesn’t, sooner or later the business will fail. As a business manager, you want to keep a close eye on the financial statements and make the necessary [more…]

Bookkeeping Checklist

This step-by-step bookkeeping checklist should help you sleep easy at night, knowing that you have done what you needed to do to get your books in tip-top shape. [more…]

Bookkeeping Basic: Understanding Account Types

Understanding the difference between account types is the secret to coding transactions correctly. Here’s the cheat’s guide to understanding the difference between assets and liabilities, equity and income [more…]

Stay Up-to-Date with Bookkeeping to Meet Tax Deadlines

Forget birthdays, anniversaries and Christmas and instead, punctuate your diary with a list of tax deadlines. Here’s a summary of the deadlines that every Australian bookkeeper needs to know about in order [more…]

Know Your Debits from Your Credits for Bookkeeping Success

Understanding debits and credits is a tricky business. (How did accountants get to be so warped, you may wonder?) Don’t sweat, with this table you can get your debits and credits spot on, every time. [more…]

How Liquidity Ratios Figure into Company Reports

If a company doesn’t have cash on hand to cover its day-to-day operations, it’s probably on shaky ground. Use the following formulas to find out whether a company has plenty of liquid [more…]

Bookkeeping Ways to Value Your Stock

Bookkeepers use various methods for valuing stock. Your company must choose one method and follow that method all the time, in order to keep the tax man happy. Four ways in which you can do this are: [more…]

Key Steps in Keeping the Books

Any workflow or work process has its key stages or steps – a part of the process where you must remember to perform a certain action. In bookkeeping, the key steps are as follows: [more…]

Building Blocks of a Bookkeeping System

At the root of any system you’ll find the essential elements that form the basis of that system. In the world of bookkeeping, the three most fundamental building blocks to any bookkeeping system are: [more…]

Flow of Credits and Debits in Double-Entry Bookkeeping

In double-entry bookkeeping, you enter all transactions in the books twice: once as a debit and once as a credit. This chart shows you how debits and credits affect your various business accounts: [more…]

Tracking Cash: Bookkeeping Musts after You Get the Money

Receiving incoming money is all well and good, but as a bookkeeper you need to remember to take certain steps after it arrives. You need to: [more…]

Defining Asset Depreciation for Businesses

Accountants use depreciation as a way to allocate the costs of a fixed asset over the period in which the asset is useable to the business. The bookkeeper records the full transaction when the asset is [more…]

Calculating the Useful Life of a Fixed Asset

Any asset that has a lifespan of more than a year is called a fixed asset. All businesses use equipment, furnishings, and vehicles that last more than a year. Although they may last longer than other assets [more…]

Exploring the Methods of Depreciating Assets

When calculating depreciation of your business assets each year, you have a choice of four methods: Straight-Line, Sum-of-Years-Digits, Double-Declining Balance, and Units of Production. After you decide [more…]

How to Use QuickBooks to Calculate Depreciation

When using QuickBooks for your accounting system, you don’t have to manually calculate depreciation expense amounts for your business. The Planning & Budgeting section of QuickBooks includes Decision Tools [more…]

Recording Long-Term Debt Transactions for Your Business

Most businesses borrow money for both long-term periods(periods of more than one year) and short-term periods(periods of one year or less). Long-term debt can include a 5-year car loan, 20-year mortgage [more…]

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