First, be careful not to make this more difficult than it needs to be. I use a fairly simple system that works great for me and may work for you, as well.

·      At the beginning of each year, I create 12 files, labeled (with a label maker or something other than my handwriting, which isn’t too legible) January – December. I put those in my accounting drawer (which is right next to my computer). I want it to be easily-accessible when I am using the folders or when my bookkeeper is here taking care of my accounting.  

·      Daily or whenever I have receipts that come in (when I make purchases at stores, when boxes are delivered from UPS with receipts inside, or when electronic receipts arrive, I put them all into my “To Be Processed” accounting folder. If it’s something I charged on one of my credit cards, then I put it in that folder. Within that folder, I have individually-labeled folders for my two main credit cards, along with a petty cash folder, etc. ‘To Be Processed” simply means that it needs to be put into my QuickBooks.  

·      Then, weekly, either my bookkeeper or I will process all of my receipts and input the information into QuickBooksPro. As soon as the information is put into QuickBooks, I move these receipts and other documentation into the current month’s receipts folder (Note: Once the final statement for the credit card comes in, I staple the corresponding receipts to that statement so it’s all together in the month’s receipt folder.  

·      Then, after the month has passed, I move the folder into one of my file cabinets that is across the room from my desk so I have access to it, but it’s not in my “prime real estate.”  

·      At the end of the year, I move all of the year’s monthly folders to my garage file cabinet (where it’s archived in case I need it) and then I start the process over with a new set of folders.

It’s not fancy, but it’s worked for my business for over 10 years (long before I even used QuickBooks. As much as I would hate to be audited, I would be ready with all my receipts, as needed.

Note:  To access a fabulous teleseminar taught by QuickBooks Pro Advisor Marie Gibson, just go to the ShoeBox101 page where you can register and receive the recording, handouts, and booklet.  Marie recommends a different format than the one I use (and one that has helped me immensely in just plain understanding accounting)…and so many folks who have taken the class have implemented her ideas to get themselves squared away for 2009.  You want to have your ‘books’ in order!

In addition to your main company, you created Pumpernickel Publishing, LLC.  I recall you mentioning that you separated your publishing company from Emphasis on Excellence, Inc. from a business perspective. I see myself creating a lot of my own products in the long term. What is necessary for me to do something similar?

My answer(s) to her questions are shared here:

I learned about the idea (and was excited about the possibilities) of creating my own publishing company through a speaker I heard from the National Speakers Association. I got quite energized about the idea, talked to my accountant who encouraged me to go ahead and start a separate company rather than doing a “sub” division of my company, Emphasis on Excellence, Inc. So, I figured, ‘OK! Let’s do it.’

Here are some of the positives of doing so that you can consider for yourself:

1. I have a separate entity that all of my publishing can go through.
2. I can publish others’ work through my company and it has its own specific publishing company name.
3. I have a separate entity that should eventually help me out tax-wise (and I’ll say why I use the word “eventually” below).
4. I love my logo! That may sound funny, but I do. It’s the little things that can make us happy each day, right?!
5. I am learning a lot through this process.
6. Since the publishing really is a separate phase/aspect of the rest of my business, it is going to be smart to have that designated under a different name (albeit not necessary to do so).

And here are some of the downsides (not really negatives, though) that I just hadn’t thought through well enough ahead of time:

1. I have a whole second set of books to keep.           
2. I have a whole second set of forms to fill out for taxes, business license, etc. (and the fees that go with all of these things).           
3. I have to have a separate credit card agreement and a separate shopping cart system to go with that credit card agreement if I want all the purchases that go with Pumpernickel Publishing, LLC to go straight from the shopping cart to the checking account that is set up for the company. So far, I haven’t done a second credit card and shopping cart. I just manage it through QuickBooks Pro, but I may have to make that change before long. We’ll see. I’m fine now because I keep good records, but it involves some additional steps to move the money from one account to another (not that there are large sums yet!)           
4. And this is the eventually part from #3 above….Because I’ve been so focused on Emphasis on Excellence, Inc. and all of its various components, I have not focused much on the publishing company. Therefore, there hasn’t been much income generated yet, although I know there will be. That’s one of my goals for the next year: to really get that company fired up. So there will be some tax benefits of having a second company but you can’t have many of those benefits until you’re making some money first!

My recommendation is to take all of these ideas into consideration….I know the first list looks shorter, however it’s only because I wanted to explain more about the second list. I’m not making a recommendation either way, just trying to put the information out there for you and others who want to consider several sides of creating a second business. Remember, it is quite possible that keeping all of your business running through one company will serve you well.

To find out what has been published through Pumpernickel Publishing, LLC  (so far), the website will give you an indication (and you can see the logo I like so much!)

(c) 2008 by Meggin McIntosh, Ph.D., “The Ph.D. of Productivity”(tm). Through her company, Emphasis on Excellence, Inc., Meggin McIntosh changes what people know, feel, dream, and do. Sound interesting? It is!

Article Source: http://EzineArticles.com/?expert=Meggin_McIntosh

Do you have any recommendations for business and personal bookkeeping programs? I am thinking of recommending Quicken to a client but have not used it in years.

I wrote this response:

…and what I use is QuickBooksPro. It does seem to be almost the ‘standard’ now for small businesses.

The person who helped me get mine set up is Marie Gibson, a small business consultant and QuickBooksPro Certified Advisor. Here’s here website: http://marie-gibson.com/index.html

Then, I contacted Marie about this and here is her great response:

Quicken, QB SimpleStart and QuickBooks Pro are published by Intuit-Quicken tends to be for personal use and allows for tracking of an investment portfolio (nice feature). QuickBooks is the standard for business as it uses a business process method, business terminology, and reports such as Profit and Loss and Balance Sheet. Simple Start (QuickBooks) is a very basic electronic checking account that may be perfect for new business owners. With that said, your clients could begin using Quicken or SimpleStart and eventually import their data into QuickBooks (and yes, this is a relatively pain-free process). 

The important thing is that they start tracking their income and expenses right away. It is difficult to go back and rebuild-so business owners pay their CPA’s to organize their records when they could do it themselves. Start simple and build your system as your business expands. Feel free to contact me directly with other questions you may have regarding the software choices.

Marie Gibson Management & Consulting, LLC.

Accounting Success-Simply!

www.marie-gibson.com

And the good news is, Marie is going to be doing a teleseminar with me in January…so stay tuned for more info on this!!

How do I pay myself?

Let me explain:  For accounting purposes, I would like to deposit all the money I make from my services and products into my business checking account.  However, I will need some of this money to pay my personal bills.  What is the best way to do this?

I know that writing a check to myself is an option as is withdrawing money from my business account.  But, how do I track this in Quickbooks Pro?  Also, should I pay myself a specified amount of money each month or should I take out what I need? 

Any advice would be appreciated.

Posted by Billy Simms | 11/6/07

Answer:

I would suggest that you ask your accountant (or call Sage International) for sure, but here’s what I do.  Since I pay myself out of Emphasis on Excellence, Inc., which is an S-Corp, I am an officer of the company and that’s how I pay myself–as an employee.  For the last 3 years, I have paid myself the same amount each month pretty much and if I have some at the end of the year to pay myself, then I do.  But at the beginning, I didn’t pay myself the same because it kind of depended what I was able to pay.  So you can vary it month to month.

In QuickBooks you can set yourself up as an employee (and I’d read the Help info on that or call your QuickBooksPro advisor to help you on this).

And good for you!  The whole reason to be making money as a business is so you can get some out to pay yourself!

What is your opinion on getting some Quickbooks training?  Quickbooks Pro is new to me and I’m a little lost.  I don’t want to start off making mistakes and I want to learn the right way.  I was quoted $275 for a personalized 3 hour course in which the instructor will come to my house and work with me.  This is a lot of money for someone who is just getting started.  However, if I decide to learn the program on my own, there is no telling how long it will take me.  It might be wiser to use that time researching, writing, and organizing content.  Opinions or advice??

Posted by Billy Simms | 07/27/07

Answer: 

This is a tough question.  My CPA was the one who “forced” me to switch to QuickBooks Pro (and she did–she said if I wouldn’t switch from my paper & pencil use of a DOME book, then she wouldn’t take me for a client).  She came over to my house/office and helped me set it up and showed me the basics–and I do mean basics.  She made sure I understood that I would learn by doing. 

At the beginning, all I really needed was to be able to write checks, create invoices, and charge credit card purchases to the right account–and I didn’t have millions of any of these–so it was good to start learning when I only had a little bit each week. 

QuickBooks has a pretty good tutorial as part of the package–and I still use it.  There are times that I think, ‘There must be some way to do this’ and I’ll type in a question and sure enough, there is a way.  I follow the steps and *usually* I can figure it out.  QuickBooks also lets you call their help line–and I don’t think I’ve ever paid for that–so it must be part of the program. 

All that said, I have hired someone (Marie Gibson, who is a QuickBooks Pro Advisor) and who was in the Make a Difference class, to come to my office and help me.  I have been using QuickBooks for 5 years and have gotten to a point where I felt like I needed one-on-one tutorial help–so it was worth it. 

$275 for 3 hours of direct help is not a bad price at all–although at the beginning of a business, it is a lot of money and I understand that.  Find out if there is any way to split that up some–just because 3 hours is a lot of info to learn and retain.  I’d rather have 2 90-minute sessions, so see if the person is open to that.   

And you’re right, you want to get set up properly from the beginning, rather than cleaning up a mess later. 

Sorry this isn’t a black/white yes/no answer, but I hope it helps!

Meggin

Can you give us some advice on the best way to file and organize our business receipts?

Posted by Billy Simms | 07/20/07

Answer:

I think for all members of MEMc, we need to be careful about making this more difficult than it is–so I use a fairly simple system and it works great for me.

1. At the beginning of each year, I create 12 files, labeled (with a label maker or something other than my handwriting, which isn’t too legible) January – December.  I put those in my accounting drawer (which is right next to my computer). I just took and picture and inserted it below so you can see how “not fancy” I make this.
2. Daily or whenever I have receipts that come in (when I make purchases at stores, when boxes are delivered from UPS with reciepts inside, or when electronic receipts arrive, I put them all into my “To Be Processed” accounting folder.  If it’s something I charged on one of my credit cards, then I put it in that folder (you can see, if you look closely, that I have a UBS and an American Express folder inside the “To Be Processed” folder). 
3. Then, weekly, I process all of my receipts and input the information into QuickBooksPro.  I am going to outsource that very soon, but for now, I’m still doing this.  As soon as things are put into QBPro, I move them into that month’s receipt folder.  I keep all of the credit card receipts together until the final statement comes in and then staple them all to that statement and put the whole thing into the month’s receipt folder. 
4. Then, after the month has passed, I move the folder into one of my file cabinets that is across the room from my desk so I have access to it, but it’s not in my “prime real estate.”
5. At the end of the year, I’ll move all of the year’s monthly folders to my garage file cabinet (where it’s archived in case I need it) and then I start the process over with a new set of folders.

Hope this makes sense.

Thanks! 

Meggin

For the type of business that most of us will be running (small, home-based) would you recommend using Quickbooks Simple Start or Quickbooks Pro?

Billy Simms/posted 6/27/07

Answer:

I recommend QuickBooks Pro.  It takes some time to learn, but it’s highly sophisticated and one you learn it, it will grow with you. 

When I started with it about 4 years ago, it was WAY more powerful than I needed, so I only used part of the features.  Now that my business has grown, I use more of the features–but there’s plenty more to learn and use.  I also recommend getting some support on learning it.  There are many classes available (some free) and then there are people who are certified QuickBooks Pro Advisors, like Marie Gibson, who I’ve used.  (marie@marie-gibson.com).

Thanks!

Meggin