A BOOKKEEPING SYSTEM THAT WILL SAVE YOU MONEY
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 simūple
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 imprinted checks.
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, 42134
$10 - How To Sell Books by Mail - Dave Sasseen, 11301
TOTAL INCOME: $3...EXPENSES: None
That's all there is to it, and emphatically, all it is to recording
what you receive and what you spend.
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.
The 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 up-to-date.
