Being a business owner comes with dozens of decisions, one of which is your accounting method. Although there are a handful of accounting methods, most business owners choose between two primary types: cash and accrual. In this article, we’ll explore the main differences between cash and accrual basis accounting, helping you determine which

Getting funding for your startup business is one of the most important decisions you’ll make as a business owner. The type of startup funding you choose will have long-lasting impacts including:  Startup funding can cover the initial costs of setting up and running a company. It can also help you continue to grow

As a business owner, you may have heard the term deferred revenue before. But, what is deferred revenue and what does it mean for your business accounting?  Deferred revenue is money that you receive from clients or customers for products or services that you haven’t delivered yet. In accounting, deferred revenue can affect

At some point, you may need to buy equipment, tools, and other assets for your business. Those assets tend to wear out after several years and lose their value. Luckily, businesses can write off those expenses if they know about depreciation and how to calculate it.  The straight-line depreciation formula is the simplest

Receipts play a surprisingly important role in running a business. Whether you track receipts to reimburse employee expenses or to prepare for a possible audit, you should keep track of them with one of these best receipt apps.  What is a receipt scanner app?  A receipt scanner app takes a photo of your

The process of 3-way matching in accounts payable protects your business against incorrect or fraudulent invoices. It mitigates risks in your company’s spending by making sure you don’t overpay for services or fall for counterfeit invoices. It may sound like no one would fall for invoice fraud—when a scammer pretends to be a

Retained earnings are a key indicator of a company’s financial performance. Read on to learn about what they are, how to calculate them, prepare a retained earnings statement, and more.  What is the difference between retained earnings, revenue, net income, and shareholders’ equity? Retained earnings represent the portion of a company’s net income

If you’re managing a business—and your books—you’ve probably had to learn what is accounts payable vs. accounts receivable.  Accounts payable and accounts receivable are two different sides of the same coin. In this case, the coin is your business. One tracks money that is going out. The other tracks money coming in. Both

Balance sheets and income statements are indispensable financial tools for all business owners. What should businesses know about the balance sheet vs. income statement? The two complement each other in tracking vital financial metrics such as net income, expenses, profitability, and more. However, there are differences between the two documents. Understanding these statements

If you run a business, you’ve likely wondered–how much does it cost to hire a tax accountant? Do I need accounting services, and will they save me more money than they cost?  While doing accounting and business taxes, you may worry about making mistakes or missing opportunities that a pro would spot right

Cover sheet Form W-3 is a federal form that Gusto files with paper copies of the Form W-2 to the Social Security Administration (SSA). This form is not required for electronically filed W-2s. W3 Tax Form Since Gusto files most federal W-2s electronically, if there are changes or corrections to W-2s, you won’t

As a professional consultant, you spend plenty of time determining how other businesses work. But, how much time have you put into determining the shape of your own business? Choosing the best legal entity for your enterprise will help minimize your risks and maximize your profits. That way, you can concentrate on consulting.

Looking to cut your business income tax rate by up to 90%? Locating in Puerto Rico might be your answer — if you’re willing to play by their rules. What Is Act 20? It’s no secret that Puerto Rico needs to boost its economy. And because it enjoys a special status within the

When you’re starting as an independent contractor, accounting practices may not be top of mind. But now is the perfect time to develop those good habits that will save you a ton of hassles and heartaches later. 1. Save Receipts As a business owner, you’re entitled to many tax deductions on expenses, from

Every month you receive a P&L statement from xendoo. In a nutshell, it tells you whether your business made a profit or a loss — for the month as well as the year to date. It can do more than that, though, if you know what the numbers mean. Here’s a quick guide. Revenue

A state resale certificate exempts you from paying sales tax on items or services you buy in that state for the purpose of reselling, renting, or leasing them out. Here’s an overview of the regulations you’ll need to follow in the state of New Jersey. Sales Tax Exemption for Buyers Purchases that qualify

If your business sells, resells, or makes new products from purchased stock, then your inventory is probably your biggest asset. The right accounting tools can help you make sure that inventory maintains its value, as well as guide business decisions for maximum success. Types of Inventory First, determine what type of inventory you

It’s all too easy to dip into the company’s bank account as and when you need to. But there are many good reasons to put yourself on a fixed salary, including simplifying your tax return, protecting yourself from the company’s debt liability…

Putting your accounting in the cloud offers huge advantages, including speed, accessibility from anywhere, and reduced on-site storage needs. But first, make very sure that your provider meets your standards and requirements. What a Cloud Provider Provides You’re probably familiar with cloud storage for files; it simply means that this data is stored

No matter how much they hate it, small business owners tend to do their own accounting. They’ll tell you they’d love to hire a bookkeeper, but they just can’t justify the expense. What they don’t take into consideration is all the ways a professional CPA can cut business expenses, take advantage of savings