Thursday, January 31, 2013

Better Bookkeeping Made Easy

Guest Post: Don't Make Bookkeeping Harder Than It Has To Be
Hey there. Today my etsy friend Kate, who some of you may know from StoryTellers Vintage and Foothill Fibers 'N Photo is sharing some of her no-nonsense expertise with us.
You see, I'm going to let you in on a little secrete. Kate is not just an expert vintageer, hunter of all-things-that-have-a-story-to-be-told, as well as a fine knitter and crocheter, she's also a CPA.
Cue scary movie music.................
I know some of your are cringing at those three letters, shrinking in a corner all intimidated, but you need to stop.
If you're running a business or even a household, Kate has some very straightforward tips about bookkeeping that will help you when it's time to prepare things for the tax man.
Trust me. You can handle these.
It's 7 Quick Steps.
What's so intimidating about that?
Here's Kate.....
I know, I know, who wants to think about record and bookkeeping for your business when there’s creating and promoting to be done.  Most people starting handmade (or vintage) businesses don’t think about the accounting necessary for a business, but this part is truly vital to your overall success.  Keeping accurate and timely records enables you to make the right decisions that are best for your business in both the short and long-run.

Hi, I’m Kate, a CPA (Certified Public Accountant) and while you may have seen me around ‘the Muse’ before, you’ll also find me managing my two Etsy shops, Foothill Fibers N’ Photo and Story Tellers Vintage.  Having a background in business and administration has helped tremendously when planning and executing my business goals and I’m happy to share some of my key record keeping tips with you.

Quick Reference Record Keeping Tips

1. Find an inventory system that works for YOU.  If you’re not keeping track of raw materials and items you sell, how will you know if you’re making a profit?  I use spreadsheets to track my yarn and vintage treasures, but if you have more complex materials, you may want to look for inventory tracking software specific to your art of expertise.
2. Keep those receipts!  Even if you just put them in a shoebox or basket.  Chances are you will not remember the time you bought mailing envelope at the grocery store that one time.  At a later date, scanning copies onto your computer can also allow you to recycle the paper and still have your records.
3. Use your receipts to categorize and tally up your expenses.  Most accountants use Quickbooks, but there are many other programs available, some even for free, like that allow you to generate Profit and Loss reports so you know where your business stands.  Opting for an easier option?  Organize your receipts and total them in a spreadsheet or log book.
4. Stay up to date.  I know it’s a daunting process, but however you record your information, I recommend never being more than a month behind of recording data.  Seeing how your business has done in the past can help you decide steps to take in the future.
5. Keep a log of your business miles driven.  If your home is your primary place of business, all those trips to the yarn store or post office count as business expenses (which is important come tax time!)  You can keep a notebook in your car or use a spreadsheet.  Either way, make sure to note the date, place you travelled to, and the total miles driven.
6. Purchases of equipment should be tracked separately from your day to day expenses.  These, normally larger priced) items, such as computers, cameras, etc. are referred to as ‘capital assets’ and their cost must be allocated over its useful life. 
7. Working from your home office?  Keep receipts for your home expenses, such as utilities, rent, repairs and office supplies and furniture.  A portion of these expenses might be deductible for tax purposes.

I’m hoping these tips can help keep your business organized and ready for any opportunity that arises during your small business journey.  Keeping in contact with your tax accountant throughout the year, can also help you plan for success.  Any specific tax questions or concerns should be directed to your accountant.  There are many accounting and tax issues that vary from business to business.  Make sure you’re making the right choices for yours.
Pam here again. There, now was that so bad?
To recap, here's a quick reference guide that you can print and hang on your above your desk, just to make sure you stay on track.
Many thanks to Kate for sharing her time and her knowledge. 
Wicked Windy 
So as I told you, we've gone from -14F last week to.....are you ready for this............above 60 yesterday! Warmer than they even predicted. Last night a nasty wind blew in, which swept the fog away. Of course, with windy often comes damage and some schools were closed in Massachusetts today because of wind damage and outages.
Speaking of damage and outages, we lost a tree along our back stone wall during the night and we've had some flickering of power today.  Which means the computer shuts down and I have to wait for it to power back up. It's a practice in patience.  We also now have a lot of wood for Gar to take the chain saw's to free fuel for the woodstove.
In case you were wondering, the tree fell backwards into the forest, and yes, we both heard it. Gar said he heard 'something' and so did I, but it didn't wake me up. It just became incorporated into my dream about trees falling onto our pool.  Good thing that part was just a dream.
So at least we've answered that age old question once and for all.
Ciao for now,


  1. Great reminder about keeping track of your utilities! I always forget about that until right before we go visit the accountant, and then it's a scramble.

    We've had some weird weather over here, too. It was 60 two days ago, and now it's 16 and snowing. What the heck, Mother Nature?

  2. Great advice! Tax season stresses me out! Especially now that I've gone past the hobby phase and into career phase. I have managed to keep half way organized so that makes me feel a little better. I got so far behind that I had to spend 3 days updating my spread sheet. I WILL NOT let that happen again! Sometimes we have to learn the hard way I guess. Whoops!

  3. I'm so glad these tips are helpful reminders! The hardest part is taking the 1st step and as Traci said above, learning from past experiences :)

    Pam...glad to hear that the tree didn't hit anything of major importance! Stay safe this crazy time of year!

  4. I have a mileage notebook in my car, but still forget to write it down!

  5. The introduction already made a good point: don’t make bookkeeping harder than it has to be. Keep it simple and less complicated. You just have to do things right from the first step. Learn the basics and make sure the tool you’re using isn’t complex intrinsically. Venita@A Reliable Bookkeeping Service

  6. That’s true. Bookkeeping is very important for any business, because it makes handling financial and logistical matters that much easier. So making it simple and easy to understand can help business owners with handling their accounts efficiently. But if one is still having troubles with keeping their books organized, they could always hire an accountant or bookkeeper to handle matters for them. Better to hand over the job to professionals than make mistakes that may prove disastrous later on. Thank you for sharing your tips!

    Rebecca Cross @ Advanced Accounts

  7. This comment has been removed by the author.

  8. Thanks for sharing these tips, Pam! It will surely help those who are looking for the best way to record their business transactions. To others, it may seem like a simple recording of all the cash transactions you made in a specific period. But this is really important, because it would reflect to the total amount of money you have either on hand or on credit, minus the expenses.

    Clyde Hudson @ Stewart Technologies


You comments make my day. Thanks for taking the time to visit Mercantile Muse and for commenting. I really appreciate it. ~Pam

Related Posts Plugin for WordPress, Blogger...