What Small Business Owners Should Know About Bookkeeping

bookkeeping small business

And, OnPay can estimate your payroll taxes, manage tax form filings, and even pay your taxes. They’ll also take responsibility for any tax filing errors committed while using the product. Once you start getting your first clients, it’s important to focus on customer satisfaction. Clients who are happy with your services are more likely to stay loyal and continue to hire you. They also may be willing to refer you to people they know who might need a good bookkeeper.

For full-time bookkeepers, the average annual salary sits around $77,000, according to Glassdoor. Do you have more questions about the bookkeeping process for small businesses? Wondering how best to collect and track financial information, deal with expense management, and ensure healthy cash flow for your business?

Accounting & Bookkeeping Software Tools Loved by Small Business

However, general ledgers can get complicated if you’re trying to juggle multiple accounts. If you choose to use double-entry bookkeeping—and we strongly suggest you do! We’ll show you examples of how to record a transaction as both a credit and debit later on. Bookkeeping over the course of a few years also makes it easier for you to estimate how much tax you’ll owe. Recording just the cost of those supplies with the cash method might give you an inaccurate picture of how much you are — or should be — spending on supplies.

At its core, bookkeeping is about recording financial data, while accounting is about interpreting financial data. Accrual basis accounting records those invoices and bills even if the funds haven’t been exchanged. Generally, accrual basis is the recommended accounting small business bookkeeping method and more aligned with generally accepted accounting principles. Accounting software makes it possible to do much of this on your own, though you may decide to outsource some basic bookkeeping tasks to an online bookkeeping service as your small business grows.

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