Quick Books Managing Your Business Finances

1. Compliments of: Blazej Accounting Managing Your Business Finances The Essentials BLAZEJ ACCOUNTING 1425 Market Boulevard Suite 330 - #130 Roswell, Georgia 30076…
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  • 1. Compliments of: Blazej Accounting Managing Your Business Finances The Essentials BLAZEJ ACCOUNTING 1425 Market Boulevard Suite 330 - #130 Roswell, Georgia 30076 Office: 404.933.9234 Fax: 678.559.0684
  • 2. Financial Management Essentials 1. Introduction to Financial Management 2. Why Accounts Are Important 3. Using Reports 4. Tips and Resources 5. Additional Concepts & Terms Compliments of: Blazej Accounting
  • 3. 1. What is Financial Management? Process of: Money In Money Out Running Your Business Recording Sales Expenses Money YOUR coming in and CUSTOMERS out Services / BUSINESS VENDORS Using Reports Products Services / to: Out Products Understand In how your business is doing Make Decisions Compliments of: Blazej Accounting
  • 4. 2. Manage Customers and Sales. Know and understand your customers through consolidated records. What 1. Cash Flow. does XYZ Company buy from me? 3. Production. Track the money Obtain goods and going in and out of services. Apply for and your business. What establish credit with your you bill and spend. vendors. YOUR BUSINESS 6. Funding. 4. Compliance. To be considered for a Report your company’s loan or investment, incomes, expenses, and you’ll need complete payroll accurately to updated financial the IRS. statements. 5. Insight and Decision Making. Make informed decisions – and price your product or service for profitability – with financial reports. Are you losing money before the product leaves the door? Compliments of: Blazej Accounting
  • 5. What do you want to know about your business? How much money am I bringing in? Sales How much am I spending? Expenses Is my business making any money? Sales-Expenses What’s the value of what my business owns? Assets How much does my business owe to others? Liabilities What is my business worth? Equity Compliments of: Blazej Accounting
  • 6. Major Account Types Assets Current (cash, inventory, Everything your business possesses accounts receivable, etc.) Fixed (property, vehicles, machinery, etc.) Liabilities Everything your business has Current (within one year) borrowed Long Term Equity Everything your business owns Contributed capital: owner’s investment Retained earnings (profits) Assets = Liabilities + Equity Compliments of: Blazej Accounting
  • 7. Categorize Your Transactions with Chart Wizard Gas Chart of Accounts Insurance Repairs •Master account lists – a chart of accounts – are used to sort your transactions into categories •Each account category contains sub-accounts Compliments of: Blazej Accounting
  • 8. Chart of Accounts: Your Master List of Accounts and Sub-Accounts INCOME ASSET Sales Income Checking Bank Other income Other income Accounts Receivable Accounts Receivable EXPENSE Undeposited funds Other Current Asset Advertising Expense Equipment Asset Car and Truck Expenses Expense LIABILITY Contract labor / payroll Expense Loans Liability Cost of goods sold Expense Sales Tax Payable Other Current Liability Entertainment / meals Expense EQUITY Office expenses Expense Contributed Capital Equity Repairs and maintenance Expense (Owner’s invested funds) Supplies Expense Retained Earnings Equity Taxes and licenses Expense (Business’ profits) Utilities Expense Other expenses Other expenses Compliments of: Blazej Accounting
  • 9. Reports help you understand how your business is doing •Use reports as a planning tool •Gain insight into your sales •Income statement (P&L) shows your profitability •Balance sheet shows assets, liabilities and equity •Regularly monitor your profitability – and your cash flow Compliments of: Blazej Accounting
  • 10. What Do You Want To Know About Your Sales? • What is selling? • Who is buying? Gain insight into the • Who owes me money? health of your business with reports: • Sales by item • Sales by customer • Unpaid invoices by customer Compliments of: Blazej Accounting
  • 11. Income Statement • Summarizes the revenue and expenses of a company over a period of time • Also called a Profit & Loss or P&L Compliments of: Blazej Accounting
  • 12. Balance Sheet • Shows the assets, liabilities, and equity at a given moment in time • Assets = Liabilities + Equity Equity also referred to as Owners Equity or Retained Equity. Compliments of: Blazej Accounting
  • 13. Manage Essential Tasks Remember, the Money in better you understand your A. Record a sale cash flow situation, B. Invoice a customer the better you’ll be prepared to make C. Receive a payment the right business D. Make a deposit decisions. Money Out E. Write a check / record an expense F. Use a credit card / record an expense Compliments of: Blazej Accounting
  • 14. Tips 1. Getting Started 2. Helpful Resources 3. Congratulations! Compliments of: Blazej Accounting
  • 15. Getting Started Establish Good Accounting 1. Computerized Software Habits 1. Record transactions regularly Consider software packages – Set a weekly date to get such as QuickBooks Simple Start everything organized 2. Structure your accounts – Keep a “receipt” envelope in your car – extremely Start with a minimum # of important to document cash accounts and add as needed 2. Accuracy and consistency are 3. Establish an accounting routine – essential and stick to it 3. Fix mistakes as they happen 4. Manage and reconcile bank Reconcile accounts monthly account regularly Review financial statements – Print out bank transactions at least once per week monthly Update financial statements quarterly Compliments of: Blazej Accounting
  • 16. Helpful Resources Advance Your Knowledge Expert help can make the process Professional Help Accountants of setting-up and We help you find a CPA if necessary maintaining your Blazej & Associates books much Expert set-up can save you time Free 30-minute consultation easier. Training & Networking Tools Blazej & Associates We help you find others that can help you with your business is Your Take business classes (either online or at local colleges) Outsourced Attend local business seminars (i.e. Chamber of “In-House” Commerce) Build a network with other business owners Accounting, Bookkeeping, & Office Concierge Compliments of: Blazej Accounting
  • 17. Congratulations! You now know: Why financial management is critical to effectively run a business How to set-up and manage your accounts The usefulness of financial reports Time to put your knowledge to work! Good luck! Compliments of: Blazej Accounting
  • 18. Determine Your Business Type 1. Sole Proprietorship One owner 2. Partnership or Limited Liability Corporation Two or more owners 3. S Corporation Small business with one or more shareholders 4. C Corporation Large business with one or more shareholders 5. Non-profit Organization Compliments of: Blazej Accounting
  • 19. Choosing an Accounting Type Cash or Accrual? A. Cash accounting The practice of recording sales Choose whichever and expenses only when cash is actually received or paid out accounting method B. Accrual accounting works best for you – The practice of reporting the important thing is income when earned and to be consistent once expenses when incurred you’ve selected an Businesses with inventory (e.g. retailers) must use this method accounting type. Most businesses opt for accrual method We suggest you of accounting discuss this with your At any given time, gives a more CPA realistic picture of the health of the business Compliments of: Blazej Accounting
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