How to Manage Small Business Accounting in 7 Steps

Small business accounting may seem daunting for those who don’t have the right tools at their disposal. Quality accounting software offers businesses and self-employed individuals a whole slew of benefits that can organize your transactions and automatically create your essential financial documents for accurate record-keeping.

Here are seven ways you can manage your small business accounting with an online bookkeeping tool!

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1. Connecting Your Business Bank Account

Whatever type of small business bank account you have, bookkeeping software can access and connect to them in one place. Sync your bank accounts, credit cards, Paypal, Square, and more with the QuickBooks accounting platform for small businesses for quick referencing.

2. Recording Income and Expenses

Before the use of software, all accounting records had to be filled in by hand and entered manually into your books. Thanks to modern cloud based software, companies and individuals can easily record all incoming and outgoing transactions in one place, with automatic syncing of accounts.

With the  expense tracker  feature, your business can access all income and expenses on your dashboard. Real-time data provides you with valuable insight into your monthly profits and losses to ensure you have a complete understanding of your business’s finances. The software automatically categorizes your transactions too, following custom rules to make referencing quick and easy for tax time.

Here’s a quick how-to guide on  importing and tracking expenses  and other useful information for your account.

3. Selecting the Right Accounting Method

Whether your business uses the cash or accrual method of accounting, QuickBooks software can switch between the two seamlessly. No matter how you choose to record your transactions- recognizing revenue and expenses when they occur or when money changes hands- this accounting software will report your account activity whichever way you prefer.

4. Preparing Journal Entries

As businesses predominantly use the double-entry accounting method, bookkeeping software can ensure that all debits and credits equal out your business accounts. Upload your account information to QuickBooks, and it'll compile your financial information while eliminating data entry errors all to save you time and effort. It'll also categorize each journal entry with expenses and income. The more you categorize, the more the software learns your preferences and settings to help you out.

5. Trial Balances

Quality software can automatically create, update, and report trial balances to assist small business owners in analyzing their account activity. QuickBooks can prepare your business' trial balance statement at the end of every accounting period to help you with adjustments while ensuring all debit and credits are equal.

6. Generating Financial Statements

Easily understand your business’s overall financial health in any given accounting period when you use QuickBooks to generate your financial statements. The software compiles all of your business accounts and journal entries to produce accurate and current balance sheets, income statements, cash flow statements and more.

You can send reminder emails to your clients, and provide them with the ability to pay their outstanding amount through the invoice with just a few clicks!

7. Reconciling and Closing Books

The monthly task of performing bank reconciliations no longer needs to be a chore. Reconcile your business bank accounts against your business’s records with this online platform, thanks to the easy-to-use dashboard. The software provides you with everything you need to close accounts and update your financial documents for the end of every accounting period and fiscal year.

Do it all with the Right Accounting Software

For professional and comprehensive accounting software for small businesses, consider using QuickBooks Online! It offers the latest bookkeeping features and can connect to various apps for better time-management and productivity. Business owners can even grant access to their financial advisor or accountant to collaborate securely.

Unsure how to perform an accounting task? With the QuickBooks resource centre, Customer Helpdesk, video tutorials, and a Community Q&A at your fingertips, you can always find the answers you need. Small business owners looking to manage all their accounting needs in one place can do so with QuickBooks software! Try the 30-day free trial today.

Back: What is Accounting?

Next: The Ultimate Business Accounting Checklist

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