Accounting is one of the most important activities that you have to engage in when running a small business. For some people, the tasks involved are second nature. They donâ€™t have problems with the numbers and making them bend to their will. For others, accounting is one of the most daunting tasks.
No matter how you view accounting, it has to be done. For small business owners, it can be a bit difficult if accounting isnâ€™t their forte. While large companies can hire teams of accountants to do the job, many small business owners would be better off doing their own accounting. If you are not too keen on accounting, you should get started on trying to learn its ins and outs.
I found a very informative article on the basics of accounting for small businesses over at Small Biz Survival. There are actually a lot of resources which you can find online but I chose this particular article due to its simplicity. It says that first, you have to start with income and expenses:
Then you have to look at assets, liability, and equity. This group might be a little more complicated. The idea is to take into account the things that your business owns. These can include vehicles, cash in the bank, money people owe you, and office equipment.
When doing accounting, you take into consideration all of the above to come up with you Chart of Accounts. Thatâ€™s the outline â€“ if you want to go into the details, I suggest heading over to Small Biz Survival and get started on accounting.