Accounting Stuff You Should Know When Starting A Small Business

You’ve bought a blender, you are growing pineapples in the back of your van, and you are ready to start a piña colada food truck. (Or this doesn’t describe you at all, but your business is as awesome as a piña colada food truck.)

If you are like most new small business owners, you really don’t enjoy the accounting side of things, and you may not know where to start with accounting in your small business.

Good news – we are here to help. Here are some of the basics you should know about when starting a small business.

Open a business bank account

If you throw all of your expenses into your personal account, when tax time comes it may be difficult for you to remember if the purple dinosaur piñata you bought was for your company staff party or your 5 year old’s birthday party.

Don’t be one of those people.

Get a separate account for your business so that when tax time comes, you know exactly what you spent on your business. (Note partnerships and corporations are legally required to have a separate bank account for business.)

Track your expenses

It makes a world of difference to use accounting software to track your expenses immediately. This lets you monitor the growth of your business, make financial statements, note deductible expenses, organize tax returns, and back up what you report on your tax return.

It’s also a hec of a lot more fun than using a spreadsheet or coffee shop napkins.

You should also have a system for keeping receipts. You can take a picture of receipts and save them on accounting software like Freshbooks or Xero.

Set up payment

Do you want to get paid with PayPal, Debit, Square… piña coladas? There are many different ways to get paid nowadays and each has their advantages and disadvantages.

If you are a brick and mortar store it’s pretty easy. You will have to accept cash and debit, and credit if you decide.

For online stores, there are a variety of options such as Square, PayPal, and third party services. You can find the best payment options for your industry by checking out About Payments.

Know Your Break Even Point

It’s important to have financial goals to strive towards otherwise you will end up working on day to day issues rather than focusing on long term business growth – which brings in the real money.

One of the simplest yet most effective goals to move towards is to hit your break-even point. This is the amount of products or services you need to sell to cover all of your costs. It’s important to set this amount before you launch, and set a date you want to achieve this by.

Get A Small Business Cloud Accountant

Do you want to concentrate on the things that made you start your business in the first place? Like working with people, or fine-tuning your product? Then delegate your accounting to a cloud accountant.

Cloud accountants help you set up systems to monitor your finances so that you know how much money you are making and what goals to strive towards. The cool thing about “the cloud” is that all your accounting can be done online.

It’s pretty magical.

It can also help save you time, stress, and mistakes you may make if you try and do your accounting on your own.

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We hope you enjoyed these accounting tips.

If you have any questions about accounting, business goals or fun things to do in Vancouver when the weather is awesome, like today, please contact us. We love to chat.