Small Business Accounting Basics: What You Should Know About Accounting For Your Small Business

Accountants help small business owners set up financial systems, analyze data, and make smarter business decisions.  They have the power to forecast business success, diagnose financial health issues, and increase revenue.  By analyzing your small business bookkeeping systems, an accountant can save you significant money, time, and hassle. 

An accountant can identify opportunities to improve profit margin and business growth, help set up systems for business accounting and teach you best practices, and keep you legal – preventing missed deadlines and noncompliance penalties.  Accountants provide tax savings advice, such as when to make capital purchases, what you can deduct and how to reduce taxes on capital gains, answer your questions about financial reports, cash flow, depreciation, and other accounting processes. 

Accountants can provide advice regarding your company’s taxes, including when to make capital purchases, what you can deduct, and how to reduce taxes on capital gains.  They can answer your questions about financial reports, cash flow, depreciation, and more.

Does my small business need an accountant?

With so many business accounting software choices now easily available, you may assume that letting your computer do as much as possible – while you help – will be cheaper than the cost of accounting services.  However, small business accounting involves analyzing the business’s financial trends and forecasts to advise business owners of ways to keep the operation financially sound.  They also work to prepare for and minimize your small business taxes by putting together monthly and quarterly statements and preparing tax filings, so you’re budgeting for taxes year-round.  It’s important work that should be reserved for a professional. In the end, you’ll save time and money by outsourcing your small business accounting to a professional.

Which accounting services do my small businesses need?

Every small business is different but they all benefit greatly from having an outside professional manage their accounting – especially their taxes.  Accountants can help verify and analyze data to create reports, perform audits, and prepare records like Profit & Loss Statements, Balance Sheets, and of course, tax returns.  A small business can use an accountant to find opportunities for growth, forecast business trends, and manage cash flow.  Accountants are also helpful for budgeting, business systems, payroll, financial reporting, and big-picture financial decisions.  Not to mention – all kinds of management decisions that follow from there.  With an accountant on your team, all aspects of your small business will benefit.

What accounting software should I use for small business?

There are so many small business accounting software options on the market today, the most popular being Quickbooks and Xero.

QuickBooks by Intuit has been on the market for over 30 years and is trusted by accountants around the world.  Their software helps you easily manage income, expenses, and more.  With the ability to connect your bank and credit cards to automatically import expenses, your financial data is synced all in one place.  QuickBooks accounting software can be a great tool for small businesses — but only if you’re using the tool right.  Unfortunately, even little mistakes can easily snowball into big, expensive consequences.  For example, if your tax return contains errors or discrepancies, you could get hit with penalties from the IRS. 

Xero is a cloud-based software that has grown in popularity with modern professionals over the last 15 years. Their software includes automatic bank and credit card account feeds, invoicing, accounts payable, expense claims, fixed asset depreciation, purchase orders, and standard business and management reporting, as well as automatically importing bank and credit card statements.  It also supports multiple tax rates and currencies.

Using Quickbooks or Xero, Xendoo accounting experts provide invaluable advice and strategies for getting the most out of your accounting software – not to mention also helping you clean up any old problems that might be lingering.  Xendoo integrates with thousands of tools you might already be using like Expensify, Stripe, Gusto, and PayPal.  Xendoo accountants will digitally reconcile your books weekly to provide you with financial reporting so you can stay on top of your business’ financial health.

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Let’s talk! Are we a fit?

Strong relationships begin with open communication. Live chat or schedule a call to get your questions answered.

How expensive is accounting for a small business?

Accounting for a small business can become expensive.  A certified CPA can charge $150-450 an hour.  Plus, you may decide you only need an accountant for an occasional project such as tax preparation, financial statement, or audit, which costs a fixed amount that can add up or you may not have allotted this in your end of the year budget.  That’s why Xendoo offers a monthly pricing structure to our clients, charging a fixed amount every month.  It’s easier to budget for bookkeeping and accounting services monthly and can cost less than half what you would pay an hourly accountant for the same amount of service.

Will a small business accounting service file my taxes?

A small business accounting service will file your taxes, but you’ll need to have your bookkeeping in order. Xendoo’s team of bookkeepers and CPAs will file the right return for you, right on time.  Plus, Xendoo also takes care of your filing that goes along with your tax return to itemize business deductions.

Do I need a bookkeeper and an accountant?

Ultimately, it’s best for you and your business to have both a bookkeeper and an accountant.  Their varied perspectives on your finances can help ensure you’re able to anticipate problems and have the appropriate solutions ready to go.  To hire just one or the other could leave you with an incomplete picture of your company’s financial health.  The more eyes looking out for your business, the better.

Do I need an accountant if self-employed?

You need an accountant, especially if you are self-employed! It is helpful to have a second set of eyes to support your business decisions.  Even if you’re operating as a single-member LLC or sole proprietorship, a bookkeeping service can also take care of filing your Schedule C that goes along with your tax return to itemize business deductions.  Unlike other companies, Xendoo caters to both bookkeeping and accounting needs.  We can provide you with excellent financial management, as well as long view advice, to help you make the best decisions for your company.

What are the types of accounting services for small businesses?

Accounting services for small businesses come in a variety of offerings.  Most accountants are flexible and offer a variety of services.  Basic accounting services include bookkeeping, budgeting, business systems, payroll, financial reporting, and sometimes strategic planning.

Bookkeeping services include coding transactions, general ledger adjustments, monthly reconciliations, month-end reporting and more.  Most services use basic software programs that keep track of daily business transactions and provide up-to-date communication between the accountant and business owner. 

Accountants also provide tax services and can update your books and computer programs regularly, providing reassurance that your records are in order and nothing will be lost.

Is Xendoo right for you?

We support thousands of small businesses with their financial needs to help set them up for success. Want to get in on their secret? Learn more today.

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We support thousands of small businesses with their financial needs to help set them up for success. Want to get in on their secret? Learn more today.

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