In business, it comes as no surprise that maintaining your books is vital. Keeping accurate financial records is a legal requirement. If you don’t know how to do bookkeeping, you have to learn or just hire an accountant. After all, you don’t want to get into any legal battles now, or do you?
Business bookkeeping is the key to having all your transactions in one place on the record. No worrying about what went where and when as everything is mentioned right there on the data. By having your records intact and up to date you have an upper hand on your finances which further helps you in making smart business decisions.
The idea of recording the entirety of your business transactions may appear to be overwhelming. However, recording transactions don’t need to be a troublesome assignment. The more you set up your books, the simpler recordkeeping will be.
How to Do Bookkeeping
Wondering how to do bookkeeping? Accountants at Accotax guide you with four easy steps along with some bookkeeping tips to help ensure your recordkeeping goes smoothly and your books are organized.
1- Accounting method
There are three kinds of bookkeeping techniques, which direct how the organization’s transactions are recorded in the company’s financial books:
- Modified cash-basis
The accounting method a business uses can majorly affect the complete income the business reports just as on the costs that it takes away from the income to get the main concern.
Picking an accounting method is crucial when you are wondering how to do bookkeeping. You ought to pick the one that suits your business best and you can handle it easily. If you require any more help our Accountants at Accotax will be more than happy to assist you.
2- How will you record transactions?
Yes, you have quite a few options from which you can pick on how to record your transactions:
- Manually recording transactions– You require spreadsheets for this and remember, give your hands a good rest so they are ready to note down all the transactions. This transaction does take comparatively more time; however, it is the cheapest option available.
- Hire an accountant– This option lifts all the burden away from you and having a professional handle your books means no common errors. Definitely leaves more time on hand for you but this does come with a price, you obviously have to pay the accountant so this comes with a price. Now, this worry of yours is taken away by us at Accotax, we provide you, affordable accountants, to take care of all your bookkeeping needs.
- Accounting software– Accounting software is a decent alternative in the event that you need to smooth out bookkeeping cycles and save time without following through on the cost of having a bookkeeper thoroughly take care of everything.
3- A business bank account
You must have heard, don’t mix business with pleasure and keep your professional and personal life apart. The same is the case when it comes to bank accounts, you need to open a business bank account.
Merging personal and business funds is a big no-no. To avoid bookkeeping slipups, wrong tax filings, and overspending, open a different bank account for business. Having a business bank account encourages you to keep your records coordinated, yet it additionally can make a reasonable audit trail for your organization.
To simplify your bookkeeping responsibilities, create and stick to a schedule or accounting cycle. Your schedule begins with your starting account balances and ends when you close your books.
Work out the means to your timetable or cycle and put time aside every week, month, and so on to go through them and update your records. Consider setting updates for yourself so you know when you need to go through your cycle and update your books.
These are the simplest four steps to help you set up and maintain your books. If there are still many questions coming to your mind related to how to do bookkeeping, then don’t hesitate to drop us a message. Accountants at Accotax will answer all your queries.