Do You Know How Much Money You Made Last Month?
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We work hard as entrepreneurs. This is a fact! There are many spokes in the entrepreneurial wheel but after the dusts settles do you take stock of what you are making in your business month to month? As a bookkeeper, I encounter many clients who manage their business using spreadsheets and pen and paper. This might feel comforting and easy but it isn’t the best way to manage your business finances and it won’t give you a good glimpse into how much money you are making in your business. The best way to do this is to get your business finances into electronic format using an accounting software system like Quickbooks Online.
My spreadsheet and my bank account tell me all I need to know which is how much money I have in the bank to spend.
I hear this a lot too and again these methods might give you some information but it won’t give you the complete picture. The best way to know how much money you made last month in your business is to do the following:
Do your bookkeeping regularly using an accounting package.
Reconcile your accounts each month and make sure they agree to your statements.
Pull your financial reports like your balance sheet, income statement and your statement of cashflows.
By using the methods above you will be more informed about how your business is doing and it will give you the knowledge and tools to be able to plan for a successful future.
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