Financial Aspects Of Business Questions

Business By Lenette Updated 2 Mar 2011 , 4:21am by platinumlady

Lenette Posted 1 Mar 2011 , 11:21pm
post #1 of 5

I struggle most with the financial end of having a business. I know if I am going to proceed I have to change this (or at least improve it icon_rolleyes.gif ).
I hope someone has some insight for me.

When you sit down to do your weekly bookkeeping activities what do you do exactly?

How do you decide how much to pay yourself?

I know many of you have separate business accounts but I have been under the impression that these are mostly checking accounts. Do you have business savings as well?

Do you keep your sales tax separate from the rest of the money?

I am just wondering how other people do things so I can review how I am operating. Anything else you want to throw at me feel free. Thank you for any help. icon_smile.gif

4 replies
platinumlady Posted 1 Mar 2011 , 11:41pm
post #2 of 5

With the financial side of things I use the Cake Boss software. I track all business supplies, ingredients, delivery etc. It shows me how much each recipe cost me and when I put in an order it shows how much I've made off that order...as well as a year-to-date. Allows you to put in your hourly rate. It has many other features that have helped me to stay organized. When I first purchased this I rarely used it (only to store recipes) But since I've been using it I've seen a huge difference on the way I do things...it more than pays for it self well worth the price.

I also keep the money earned separate than my personal account. I primarily use PayPal for that. This is the way I accept payments (no e-checks). I order my supplies from my PayPal account. Then I pay myself from there using a transfer to my bank account.

As far as tax goes...my tax is included in the price.

Hope that helps some

jason_kraft Posted 2 Mar 2011 , 12:57am
post #3 of 5

We had priced out our products and figured out all the relevant cost components with Excel so cake boss wasn't necessary for us, but I use QuickBooks regularly to manage the accounting. Once I had set up the company's QB file -- which was not trivial -- the only thing I need to do is enter business expenses, sales (invoices), payments received, and deposits every few weeks. I did the corporate taxes a few weeks ago, it took about 15 minutes with TurboTax Business since it automatically imports data from QuickBooks.

Even though we have an LLC I like to keep as little money in the business accounts as possible, so I just have a free business checking account with a local credit union, they tend to have better terms and fewer fees than banks. Interest rates are so low right now it's not even worth looking at a business savings account unless you keep large sums of money there.

Here in northern CA we are not required to collect sales tax since we don't have a retail shop with a seating area. But if we did collect sales tax, I probably wouldn't keep it in a separate bank account, but the sales tax from each order would be posted to a different income account in QuickBooks.

jason_kraft Posted 2 Mar 2011 , 1:01am
post #4 of 5
Quote:
Originally Posted by platinumlady

I also keep the money earned separate than my personal account. I primarily use PayPal for that. This is the way I accept payments (no e-checks). I order my supplies from my PayPal account. Then I pay myself from there using a transfer to my bank account.



Just a word of warning about PayPal -- make sure to keep your PayPal account as empty as possible, since PayPal is not a bank and they can freeze your assets at any time if a customer files a complaint. Also have a backup plan in case your PayPal account is frozen and you need to pay bills, and never link a PayPal account to a real bank account that's not disposable.

We've only use PayPal to accept payments a few times as a last resort, when we've had customers from other countries who do not have US credit cards.

platinumlady Posted 2 Mar 2011 , 4:21am
post #5 of 5

Thanks Jason...I do have a back up. I started using it because of stories of some that made cakes only to arrive & the customer didn't have the money or the customers wrote a check & it didn't clear the bank.

I do see where there is an option for people to pay from another country & it will convert your funds...Not sure on the fees.

I wish I could remember how to set up an Excel spread that would have done this. But I didn't stay up one Excel & forgot how to do a lot of on there. It's good that you were able to do that & I know that was not an easy task...my hat off to you

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