Summary:
This tutorial helps small business owners to determine if double-entry bookkeeping is right for tracking the financial records of their company.

Details or Sample:
How to keep track of finances is an important question for small business owners. This tutorial explores whether double-entry bookkeeping is right for you. You are a small business owner who typically uses a simple spreadsheet or the basic entries in the checkbook register for your company bank account to track your company’s financial activities. Should you switch to accounting software for managing the cash flows of your business?

Face it. You are standing at an important crossroads. There are a few things to consider before switching. Within each question, some benefits of accounting are included.

What type of paperwork system do you already have? Okay, it is likely that you have some system for managing the paperwork for your business. You might have a folder, a drawer, or a shoebox for all the bills or expenses that you pay each month. You might have a separate place for payments that you receive. These transactions can easily be put into a simple accounting spreadsheet designed for a small business. You can switch to double-entry accounting software in which the proper calculations are performed automatically because the right formulas are programmed into the spreadsheet. Remember, using the system yourself requires that you consistently input transactions on a timely basis.

Are you going to be doing the bookkeeping? This next consideration is important. If you are doing your own recordkeeping, it may seem daunting at first to take on a new accounting program. However, there are great books and online resources that can introduce you to the basics of accounting and to using a software program.

Is it worth your time and money to switch to a new recording system? This is a cost-benefit analysis that you have to consider. Basic accounting software for a small business is not expensive. For example, you may already have a versatile program like Microsoft Excel on your home or business computer. If you do a simple search for help topics in the Microsoft Help online component of your Excel program, you will learn that there are many templates for your business available in the program or easily downloadable from Microsoft.com.

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Written by: Grady
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