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Document
money that your small business spends in a cash disbursements journal. It should have columns for
various expenditures that your small business may have with a line for each expenditure, including description of expense, date, payee, check number and total amount.
Double-Entry Bookkeeping As your business grows, you may need to adopt a double-entry bookkeeping system. This system provides more information to paint a more complete picture of your business at any particular point in time. This information may include available cash on hand, accounts payable, utilities, loans, etc.
Your small business should use a double-entry bookkeeping system if has significant accounts receivable, accounts payable, equipment that depreciates or inventory. If your business will meet any of these, you should select a double-entry system from
start. You'll use journals and ledgers to record information that reflect your business transactions.
Each transaction will be recorded twice, meaning
system will balance itself out. For example, if you make a loan payment, you will decrease
cash amount in your cash account and increase
exact amount in
expense account.
What Type of Records To Keep The type of business you operate generally affects
type of records you need to keep for federal tax purposes. You'll need supporting documents to capture important details, such as your receipts, purchases, expenses, assets.
Here are some other basic record keeping tips to keep in mind: "Daily business records are
best "Identify source of receipts "Record expenses when they occur "Keep complete records on all assets
Remember, good record keeping is essential to
financial survival of your business. So take
time to keep good records, so you can run your business successfully - instead of it running you.

Copyright 2005 Kate Smalley, Connecticut Secretary Freelance Secretarial and Transcription Services http://www.connecticutsecretary.com kms@connecticutsecretary.com