Small Business Accounting Terms

Small Business Accounting Terms

How do you call now maintain records for a small business? It might seem daunting but really, maintaining records for your small business is easy when you think about the goals of small business accounting: To effectively maintain financial records for tax filing purposes and track your company’s expenses. So many small business owners make the mistake of jumping into business accounting too fast and as a result they are setting themselves up for failure. Instead, small business accounting should be treated like a project that needs to be worked on gradually and with a great deal of planning.

 

Some of the common financial records for small business accounting include income receipts, sales receipts, purchase receipts, and income taxes. Some small business accounting terms are involved in these records such as: debits, credits, payments, bank deposits, and checks. Sometimes people use the terms: gross proceeds, net proceeds, and gross profits when talking about small business accounting records. When talking about gross proceeds, this refers to the total amount of money the company makes minus the total amount of money it owes, including interest and other expenses.

 

There are many different books that are used in a small business accounting system. One such book is a statement of accounts, which records all the different financial records for a particular month or period. Another is a statement of comprehensive financial condition, which can include a summary of expenses, a profit and loss statement, a cash flow analysis, and a statement of cash resources and short term financing needs. A journal of transactions, or journal, is a detailed written account of the events that occurred during a period of time. A final book, which is called a final report, is usually issued by a small business accounting firm and includes a corporate governance policy, a corporate governance overview, and an executive summary.

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