Tips on Basic Bookkeeping

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Does the thought of doing your own taxes scare you? How about doing your own bookkeeping? Whether you run a small business or have to do your own taxes, learning the ins and outs of basic bookkeeping can save you a lot of heartache in the future. I’m sure you are already aware of the vital importance of basic bookkeeping whether from a business or a personal standpoint. But you, like most people, probably avoid (or want to avoid) anything that deals with paperwork, forms, and breaking pencils. Bookkeeping is not as hard as you think it is. In fact, if you can become a master (even a little master) in basic bookkeeping, getting your taxes done will be a whole lot easier. Did you know that basic tasks such as paying your bills on time and taking care of the finances all fall under the realm of bookkeeping? In order to be good at the basics of bookkeeping you will need to familiarize yourself with some bookkeeping terms such as: accounts receivable (money due from customers’), accounts payable (bills to pay), loans payable (bills from items you bought on loan), cash (receipts and disbursements), inventory (products to sell), purchases (goods that you bought), sales (track incoming revenue owners’), retained earnings (company’s profits that are reinvested into the business), equity (how much each owner puts into the business), and payroll expenses (your employees pay checks).

 

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