Operating a business has its challenges, but you have to make sure you stay focused on accounting and bookkeeping that if you don’t manage debt, receivables and marketing expenses accurately, your company will sink before it grows. One of the great things about BondEsq Accounting & Bookkeeping Services is that while we take care of your accounting and bookkeeping needs, we provide information that is relevant to your business that helps you to manage your business efficiently and smarter.
Often times businesses don't see or understand the need to outsource an accountant, bookkeeper or even a payroll specialist because they see outsourcing as an expense and not an investment. The strategy of outsourcing should be seen as a return on investment to the company and not seen as just another expense.
Businesses that outsource its Accounting and Bookkeeping, will indeed save valuable time, money and resources. The company can do things like add new products, services, hire key personnel, including adding marketing programs to attract more sales.
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Interesting Reads: Restaurant
➤ How to spot Financial Red Flags in your restaurant and what to do about them?
➤ Things you can do to Manage Food Cost in your restaurant.
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10 Must Have Business Tips
You can save your company by implementing simple bookkeeping strategies and here are10 accounting tips to help grow your business.
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Interesting Reads: Construction
➤ How to: Accounting in the Construction Industry
➤ Cashflow Tips in the Construction Industry
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Accountant vs Bookkeeper:
What is the difference?
It is important to understand that both accountants and bookkeepers are important parts of your business. While their tasks can sometimes overlap, there are definitely certain aspects of your business that you would specifically entrust to an accountant, and others that you would give to your bookkeeper. That said, both work to assist you with your company finances, but there are some important distinctions between the tasks of a bookkeeper and an accountant.
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Our goal is to help you understand the basic concepts of accounting, the terminogy used and how they relate to
your business and general knowledge. One of the great things about BondEsq Accounting & Bookkeeping Services is educating and empowering its customers and readers with useful information to help understand the language of business.
First, let's start with an overview of how accounting fits into your daily life. Quite simply, every transaction you make results in an entry into your “books.” Whether it is a receipt of cash, a sale, a check or electronic payment you have made or a deposit from a customer – every transaction gets recorded in your books at some point. The timeliness and accuracy of when and how you record your transactions, directly affects your ability to manage your business and your cash flow. Accurate and timely data entry equals, accurate and timely financial statements. As long as all your transactions are entered correctly, a simple click of the mouse will produce the information you need.
Knowing: The Golden Rules of Accounting
1. Debits ALWAYS EQUAL Credits
2. Increases DO NOT NECESSARILY EQUAL Decreases
3. Assets - Liabilities = Owner’s Equity
Don’t let the words ‘debits’ and ‘credits’ scare you. They simply refer to the ‘left side’ and ‘right side’ of a ‘T Account’, a graphical representation of the amounts recorded into an account. Every transaction recorded into your ledger is posted to your accounts as a combination of debits and credits.
What is an Asset?
An asset is anything you own in your business. They are the things in your office, your laptops and desktops, scanners, hard drives, your vehicles, your receivables owed by customers and your cash on hand. Everything you own is considered an asset of the business.
Assets are used to generate revenue and purchase other assets. For example, when you buy a new computer, you use one asset (cash) in exchange for another asset (computer equipment).
What is a Liability?
Your liabilities are the things you owe, like sales taxes received from sales but not yet paid to
the state, or loans payable to your bank. Another example is your credit cards – unless you pay your balance off every month, the money you owe to your credit card company is considered a liability on your books. Liabilities represent claims against your assets.
The difference between the value of your assets and the total of your liabilities is the value of your company. As the Accounting Equation states: Assets - Liabilities = Owner’s Equity.
Depending on the type of taxable entity you created when you first formed your company, the Owner’s Equity section of your Chart of Accounts and Balance Sheet may have another name.
What is Income?
The revenue of your company is the total amount of proceeds generated for providing goods
and services to your customers. This is typically the total amount of the invoices that you generated for your customers.
What is an Expense?
Expenses are the costs you incur to run your business, whether they are fixed costs
(independent of how much business activity you have, like rent) or variable costs (directly related to how much business activity you have, like shipping).
What are Cost of Sales?
Cost of Sales (COS) or Cost of Goods Sold (COGS) refers to the total value of the goods and services that were sold to your customers. Typically, this refers to items-based businesses that buy inventory for resale,
or a manufacturer who builds items for resale. Total revenue less cost of goods sold equals
your gross profit.
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