Bookkeeping Your Own Business

Single entry bookkeeping is a good choice if you run a small simple business with a low volume of transactions.

Bookkeeping your own business. Filing as a company does typically involve fees and they vary from state to state. You ll need to record the money going out as well as the money coming in. Hold onto receipts bills and cancelled checks.

A bookkeeper s top responsibility is to keep a chronological list of related debits and credits of a business. Bookkeeping in a business firm is an important but preliminary function to the actual accounting function. While you absolutely could handle your bookkeeping business as a sole proprietorship protecting yourself by becoming an llc can keep you from being personally liable should your business be sued.

If you already have an in depth knowledge of bookkeeping and or years of experience in the industry the idea of starting your own business can be very attractive. A quick heads up about double entry bookkeeping. Every time money enters or leaves your business it s recorded once as a positive income or negative expense value.

Best of all you don t need to become an overnight calculus expert to understand bookkeeping. Proper bookkeeping also allows you to determine the areas within your company that could benefit from improvements. Bookkeeping is the process of recording and organizing a business s financial transactions.

A bookkeeper collects the documentation for each financial transaction records the transactions in the accounting journal classifies each transaction as one or more debits and one or more credits and organizes the transactions according to the firm s chart of account. Bookkeeping allows you to have a greater understanding of the areas within your business where you can trim costs. Creating a business plan and learning how to get clients are a couple examples of what you need to do to get up and running.

With the right bookkeeping tools you ll feel more confident in your business s future and better able to understand and plan for your own profitability. Because documentation is key you ll need to get organized. Which forms part of a ledger of accounts.