How To Set Up A Simplified Accounting System For Your Home Business

How To Set Up A Simplified Accounting System For
Your Home Business
Copyright © Jose Love

http://jlove.payitforward4profits.com

A lot of home businesses fail because they lack the

necessary financial system to track down the flow

of their money. More often than not, home based

business owners are not really very keen at keeping

their books of accounts, thinking that as long as

money keeps coming in, they will be alright.

Unfortunately, things are not really that simply

when you are engaged in business. If you want to

stay in business for a long time, you will need to

keep track of your financial flow for your own use

and for taxation purposes. Note that if you do not

keep track of your income, sooner or later the IRS

will be unto you and you will get into big trouble.

Setting up your own simplified bookkeeping system

is not really very complicated. If you like to keep

your records in your computer, you might want to

buy accounting software or just simply use whatever

programs that will allow you to make a spreadsheet

in your computer to record your daily transactions.

However, you have some money to spare for an

accounting program, it would be better to have one.

There is a number of easy to use accounting

software being sold in the market today. The good

thing about these accounting programs is that you

do not need to worry about balancing your books of

accounts. You simply input all your data in one

page and the program will run on its own. Most

accounting programs will automatically perform the

different accounting process and will immediately

update your statements of accounts. Retrieving data

from an accounting program is also easy. All you

need to do is to go to it archives and select which

ones you want to see. For instance, if you want to

know how much your net income is for the month, you

simply pull-out the income statement page and you

will see your income instantly. Another advantage

of using a computer accounting program is that you

get rid of all the papers and ledgers in your

workplace.

Now, in case you are not comfortable using your

computer to balance your books, then you just have

to you things the old-fashioned way. What if you do

not know anything about accounting processes? Never

mind if you are not good in accounting and

balancing statements of accounts, just keep a

simplified records of your transactions. A three

column worksheet will do nicely. You can easily

find this type of worksheet in the bookstore. When

dividing your worksheet, you can have one column

for all the money you received in connection with

the business, another column for all the money that

you spend for your business and the third column

will be for your running balance.



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