One of the most important, least understood and
appreciated aspects of any business, is its
bookkeeping or accounting system. And, because very few people know much about the reasons
for a bookkeeping system, most people are frightened by the thought of the work involved in
setting up such a system, and the drudgery of daily maintenance.
There's really nothing complicated to bookkeeping
- it's as simple as keeping a daily diary
and/or maintaining your personal checkbook. At the bottom line, it's simple a matter of recording
your deposits - your incoming monies - and keeping a record of the money you spend.
So, the first thing you need to do is open a business
account for your extra-income business or
endeavors. Generally, this is simply a matter of asking the new accounts teller at a local bank for a
business account registration card. Fill this card in, and with the small registration fee, send it in to
the appropriate commissioner, and from there, open your new business account - complete with
Drop by a local sxtationery store and pick up
a loose leaf notebook, and a supply of paper.
We've always picked up a supply of index tabs at the same time - either to separate the months
or the accountability sections for each item we sell.
Assuming that you want to make it as simple as
possible, while at the same time keeping it as
efficient as is necessary - here's what you do and how you do it.
On the first page in your notebook, write on the
top line and in the middle of the page: Monday,
January 1st, 1994 or whatever day you officially start your business. Then, as your orders come
in if by mail, as you open your mail - jot down starting from the left side of page, the amount you
received - dash - for what - from whom, and their address. The page might look like this:
Monday - January 1st, 1994
$3 - Tax-Saving Report - Jim Sloan, 97301 $6 -
Tax-Saving & Dating Report - Steve Nelson,
30261 $3 - 5-Letters P/Day Report - Gloria Watson, 63222 $10 - Easy Money - Bob Elliott,
$10 - How To Sell Books by Mail - Dave Sasseen, 11301 TOTAL INCOME:
That's all there is to it, and emphatically, all
it is to recording what you receive and what you
The next entry, immediately under the first day's entry, might look like this:
Tuesday - January 2nd, 1994
$60 - Deposit$11 - Check to Printer
$11 - Consulting Manual - H.P. Barnum, 33351 $3 - Tax-Saving Report - Rulon Collins, 21265
$3 - Seminar Promoter's Report, Kim Novak, 90631 $7 - H/B Business Ideas Report - Charles
Johnson, 97620 $10 - Hong Kong Directory - Robert Carpenter, 89401 $2 - Money Getter's
Guild Member - Glen Brinks, 83801 $15 - How To Steal $1,000,000 Free Publicity - Joe
O'Malley, 77919 $20 - New Release Program - Nancy Hall, 82109 TOTAL INCOME:
$7...+EXPENSES: $11...DEPOSIT: $60
And then, carry on with this recording of the
money you deposit, receive and spend each day with
similar entries for each day of the week - every day Monday through Saturday for each week. It's
simple, uncomplicated, and a positive record of your business activity.
Then at the end of each month transfer this daily
diary information to one of the low cost
bookkeeping registers that your tax consultant or accountant can work from. These people won't
work from your daily diary, and will not transfer the information you record in it to a formal
bookkeeping register without charging you a small fortune. It's not that big of a job, and if you do
it after the close of business on the last day of each month, it won't take you but just a very few
minutes. Then, of course, when you're ready to file your taxes, you simply give your bookkeeping
register to whoever is going to do your taxes, and you're home free.
bookkeeping register you'll need can be any simple columnar notebook -
we use an
"Ekonomik Register, Form RL-17" available in a number of different styles and sizes form
Ekonomik Systems - PO Box 11413 - Tacoma, WA 98411. All you really need is some sort of
notebook with a number of columns marked off, a title written at the top of each column, and a
record of the money received for each day relative to the product or service each column
represents. Then at the end of each month, you can simply add the totals from each column and
you'll instantly know how much money you took in form each of your offers.
Beyond the date column, will be your record of
expenses or money spent. Again, you should title
each of the columns you'll be entering figures into, and then record your expenditures for items
falling into those categories. Then at the end of each month, it's a simple matter to add the totals
from each column and know exactly where you stand relative to profit or loss - how much you
took in compared to how much you spent.
Bookkeeping and/or accounting is very simple and
should not scare you. Just keep it simple, and