Accounting knowledge and basic bookkeeping skills are fundamental for financial accounting topics for small business owners and CPAs. They fall under the basic accounting principles category. See bookkeeping tips and accounting lessons below…or find these topics in online courses such as free online bookkeeping courses, LinkedIn learning, or any reputable bookkeeping class.
Basic Bookkeeping Tips
Decide if a single entry or double-entry bookkeeping system would be best for your business and its financial transactions.
In making that decision, keep in mind that a small sole proprietorship or home-based business may not require a double-entry system to record business transactions.
However, if you have quite a few accounts receivable (money owed to your business by your customers) or accounts payable (money owed by your business), you may want to consider utilizing a double-entry bookkeeping system.
Many small business owners will not start right out with a double-entry bookkeeping system.
It is easier for them to use a single entry method, like your check register. You just add the money coming in and subtract the money going out and keep a running balance.
Most medium and large businesses use a double-entry system that tracks their income and expense AND their assets and liabilities.
Double-entry bookkeeping is required for all businesses required to produce a financial report of their assets and liabilities (a balance sheet) that make up the accounting equation.
Take, for example, the purchase of a laptop. In a single entry system, you would simply subtract the purchase price from your running total.
In a double-entry system, you would debit your asset account and credit either cash or accounts payable…depending on how you paid for it. See why a double entry system is best for tracking assets and liabilities?
See this page for more on the difference between double entry and single entry basic bookkeeping.
See this page for 5 basic bookkeeping tips that will make your small business bookkeeping more efficient and simpler.
See the accounting lessons below for more accounting and basic bookkeeping tips!
Accounting Lessons:
Lesson 1: Understanding basic accounting concepts is a must for every small business owner.Learn accounting basics such as debits and credits and accounting terminology…
Lesson 2: Is double entry accounting right for your small business or will another accounting system work better…
Lesson 3: Learning how to record journal entries is the foundation of any accounting course…
How to Record Accounting Journal Entries
Lesson 4: A general ledger is a collection of your chart of accounts. It is where all of your accounting journal entries end up…
Lesson 5: Financial statements is one of the keys to your business success…
Understanding Financial Statements
Lesson 6: Financial ratios and performing a financial analysis using your financial statements can be a valuable tool in constructing a successful small business…
Lesson 7: Your small business’s break-even point is the point where your total revenue received equals your total costs associated with the sale of your product or service…
Figuring your Break-Even Point
Lesson 8: Cost accounting is determining the cost of producing your product and using that information to make a profit…
Lesson 9: Account Receivables (AR) are sales made by your small business, but not paid for yet by customers…
How to Track and Record your Account Receivables
Lesson 10: The accounts payable process for a small business is simply the process of accounting for and paying invoices that your business legitimately owes…
How to Track and Record Account Payables
Lesson 11: Accounting for sales tax is not too complex if you understand the basics of accounting…
Sales Tax Accounting Journal Entries
Lesson 12: Payroll accounting involves both expense and liabilities accounts…
Lesson 13: Accounting for sale discounts returns is not too difficult if you understand the basic accounting concepts behind the journal entries involved on paper or behind the scenes in accounting software.
Accounting for Sale Discounts Returns
Lesson 14: Doing a cash flow analysis for a small business can make a huge difference when it comes to determining whether or not your business is on the right track…
Lesson 15: Depreciation accounting can seem a bit overwhelming, but once you learn a little bit about how it works …
Lesson 16: When it comes to accounting and inventory, there are many things to be aware of…
