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Bookkeeping

admin — Sat, 13 Jun 2009 19:01:22 +0000

So what goes on the accounting and bookkeeping departments? What do these people do on a daily basis?

Well, one thing they do that’s terribly important to everyone working there is Payroll. All the salaries and taxes earned and paid by every employee every pay period have to be recorded. The payroll department has to ensure that the appropriate federal, state and local taxes are being deducted. The pay stub attached to your paycheck records these taxes. They usually include income tax, social security taxes pous employment taxes that have to be paid to federal and state government. Other deductions include personal ones, such as for retirement, vacation, sick pay or medical benefits. It’s a critical function. Some companies have their own payroll departments; others outsource it to specialists.

The accounting department receives and records any payments or cash received from customers or clients of the business or service. The accounting department has to make sure that the money is sourced accurately and deposited in the appropriate accounts. They also manage where the money goes; how much of it is kept on-hand for areas such as payroll, or how much of it goes out to pay what the company owes its banks, vendors and other obligations. Some should also be invested.

The other side of the receivables business is the payables area, or cash disbursements. A company writes a lot of checks during the course of year to pay for purchases, supplies, salaries, taxes, loans and services. The accounting department prepares all these checks and records to whom they were disbursed, how much and for what. Accounting departments also keep track of purchase orders placed for inventory, such as products that will be sold to customers or clients. They also keep track of assets such as a business’s property and equipment. This can include the office building, furniture, computers, even the smallest items such as pencils and pens.

Basic Accounting Principles

admin — Sat, 13 Jun 2009 13:11:17 +0000

Accounting has been defined as, by Professor of Accounting at the University of Michigan William A Paton as having one basic function: “facilitating the administration of economic activity. This function has two closely related phases: 1) measuring and arraying economic data; and
2) communicating the results of this process to interested parties.”

As an example:

a company’s accountants periodically measure the profit and loss for a month, a quarter or a fiscal year and publish these results in a statement of profit and loss that’s called an income statement. These statements include elements such as accounts receivable (what’s owed to the company) and accounts payable (what the company owes). It can also get pretty complicated with subjects like retained earnings and accelerated depreciation. This at the higher levels of accounting and in the organization.

Much of accounting though, is also concerned with basic bookkeeping. This is the process that records every transaction; every bill paid, every dime owed, every dollar and cent spent and accumulated.

But the owners of the company, which can be individual owners or millions of shareholders are most concerned with the summaries of these transactions, contained in the financial statement. The financial statement summarizes a company’s assets. A value of an asset is what it cost when it was first acquired. The financial statement also records what the sources of the assets were. Some assets are in the form of loans that have to be paid back. Profits are also an asset of the business.

In what’s called double-entry bookkeeping, the liabilities are also summarized. Obviously, a company wants to show a higher amount of assets to offset the liabilities and show a profit. The management of these two elements is the essence of accounting.

There is a system for doing this; not every company or individual can devise their own systems for accounting; the result would be chaos!

What Is Accounting Anyway

admin — Sat, 13 Jun 2009 12:49:47 +0000

Anyone who’s worked in an office at some point or another has had to go to accounting. They’re the people who pay and send out the bills that keep the business running. They do a lot more than that, though. Sometimes referred to as “bean counters” they also keep their eye on profits, costs and losses. Unless you’re running your own business and acting as your own accountant, you’d have no way of knowing just how profitable – or not – your business is without some form of accounting.

No matter what business you’re in, even if all you do is balance a checkbook, that’s still accounting. It’s part of even a kid’s life. Saving an allowance, spending it all at once – these are accounting principles.

What are some other businesses where accounting is critical? Well, farmers need to follow careful accounting procedures. Many of them run their farms year to year by taking loans to plant the crops. If it’s a good year, a profitable one, then they can pay off their loan; if not, they might have to carry the loan over, and accrue more interest charges.

Every business and every individual needs to have some kind of accounting system in their lives. Otherwise, the finances can get away from them, they don’t know what they’ve spent, or whether they can expect a profit or a loss from their business. Staying on top of accounting, whether it’s for a multi-billion dollar business or for a personal checking account is a necessary activity on a daily basis if you’re smart. Not doing so can mean anything from a bounced check or posting a loss to a company’s shareholders. Both scenarios can be equally devastating.

Accounting is basically information, and this information is published periodically in business as a profit and loss statement, or an income statement.

How do you quit your job?

admin — Fri, 08 May 2009 10:42:34 +0000

By:Bassem H.A

It can be hard to start your own business, especially with the fear hanging around you that you could lose everything if the business fails. You have to avoid the self-employment trap.

What is this self employment trap?

When you become your own boss you most likely will work harder for less money. You might do great and have a lot of work from different people but then what happens if your work starts to thin out on you? Know you are living from job to job hoping that you can keep work.

A lot of people that have started their own business have done great at first from the way that they market their business and once they get really busy they just shut down the marketing and then the work that they had dries up on them and they are left with a business that is not doing any business.

If you are doing everything for your business by yourself such as your marketing, sales, keeping the books, and the operations of the company then you are taking time away from the making money aspect of the business. This could also cause you to get bored or burnt out on your business.

It is best if you think like a business and not as if you have a boss at home. Stop thinking as if you are still getting checks signed by the president of your own company and start looking beyond earned income.

You want to think like a successful business.

One of the big problems that business owners run into is that they trade their time for money. So if you stop giving your time to your job then you don’t get any money to spend or pay bills with. If you get sick or you want to take a vacation then the money is not there. You have to sacrifice your time for the money that you make.

It is not just your time being taken but the money you make as well. When you operate as a sole proprietorship and you are self-employed, they take a healthy self-employment tax from you. There are ways of avoiding this however I am not an accountant or a CPA of any sorts so this is not any type of legal information. You have to learn to think like a business, also prior to quitting your job you should interview some tax advisors around your area and get educated with different business and tax strategies.

You need to build an income that has many different types of income streams.

It is wise to build a company that will work for you and not against you. My best information is how to build a business that will allow you to quit your job is to have a business that allows you to make money in more than one place. *You have many options to what you can do for your income portfolio, all you need is a good imagination, drop the fear and plan what you want to do.

Find other people to do the things that you don’t want to do. Make your day fun instead of like a boring work day. *Find different people such as private contractors or maybe even hire some employees to do some of the work for you.

How do you quit your job?

My information for you is to stop thinking that you have to do everything yourself to make your business work. You need to have fun and set up a schedule for you to go by so you don’t have to work so hard trying to find time to do things for your business. Find different places to make money and to put your money.

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How Do You Choose A Tax Service For Your Company?

admin — Thu, 30 Apr 2009 15:13:13 +0000

Tax Service .jpg

There is more than one way that you can find a tax service company

. You can look in the phonebook or the yellow pages. But in the yellow pages you can get a lot of different names and you might not know where to start. It would be smart to ask your friends, business associates, and other businesses if they know of a good tax service company or if they can tell you who not to use. Once you find some tax service companies that you would like to talk with then give them a call and discuss your requirements.

What kind of tax service do you want or need?

First you have to figure out how much help you need, you might just need someone to file the taxes on your small business. Maybe you have a few employees and you want your tax servicer to wade through those documents. And maybe you want everything that you can get out of a tax servicer.

How many tax servicers are you going to want or need?

If you are running a small business then you will most likely only want one person to do your taxes and handle all of your tax information as needed. Or you might need to have a team of tax servicers, this is not needed if it is just you unless you feel strongly that you need them all for your business.
Once you have found the type of tax services that you want then you can start your search. The amount of money that you want to or have to put into your tax services can be a problem too. But you get what you pay for; remember that you can get a heavy fine or fines if your taxes are not done properly so you want to be sure that you have the right tax services for your company.

No matter how qualified they are professionally or how many people said they were this or they were that. These are the people who will be handling your financial records and basically handling your business. You want to feel safe and you want to have a good relationship with whoever your tax servicer is.

All businesses need some kind or help with their tax and accounting at one point or another in their company’s lifetime. Really large companies have their own tax and accounting department most of the time or they will contract out a large tax service company to do all their work for them. So no matter what types of business you may be running you are going to need some type of tax service at one point or another. You might as well pick the best one for you.