Keeping Tabs On Your Cash
Keeping Tabs On Your Cash
Lesson Goals:
• Entrepreneurs will learn:
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Basic elements of a record keeping system
Records needed to meet tax requirements
How to track business profitability in a timely manner
The importance of maintaining a record keeping
system
Keeping Tabs On Your Cash
Records Provide Information
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About profitability
To make sound business decisions
To set profitable prices
To alleviate financial errors
To complete your tax forms
Keeping Tabs On Your Cash
Keys to an Effective Recordkeeping System
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Simple
Easy to understand
Reliable
Accurate
Consistent
Provide information on a timely basis
Keeping Tabs On Your Cash
Checkbook
Period
beginning
balance
Funds
deposited
Bank Statement
Checks
written
Ending
balance
If the checkbook’s ending balance agrees with the bank statement’s
ending balance, then you are ready to reconcile.
Keeping Tabs On Your Cash
Elements to Include in Your Financial Records
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Incoming Merchandise/Supplies
Outgoing Merchandise or Services
Incoming Money (receipts)
Outing Money (payments)
Equipment purchases and depreciation records
Reports
Keeping Tabs On Your Cash
Incoming Merchandise &
Supplies
• Copies of purchase orders
• Verified packing lists or
receiving logs
• Inventory sheets or records
Keeping Tabs On Your Cash
Outgoing
Merchandise/Services
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Sales slips
Return receipt records
Work order
Credit customers billing
Keeping Tabs On Your Cash
Incoming Money
• Cash report
• Checking deposits
• Credit customers
accounts
Keeping Tabs On Your Cash
Outgoing Money
• Check register/canceled
checks
• Petty cash vouchers
• Invoices (accounts payable)
Keeping Tabs On Your Cash
Reports
• Daily cash report
• Income statement
• Balance sheet