Two important records to keep when starting out
From day one we should be keeping a log of revenue and expenses and weekly creating a income statement.
A daily revenue and expense log does just that.
We record all expenses as they occur or on the same day.
We record all revenue as it occurs or on the same day.
At the end of the week we total up all our revenue and expenses and then minus the expenses from the revenue. A positive total indicates were are in a profit and its magnitude. A negative total indicates we are in a loss situation.
This is our income statement or profit and loss statement or P&L.
These financial records can be kept on paper or using software. If software, don't forget to take regular backups.
These records will become more complex as our business grows. We will start breaking expenses and revenue down into categories and be able to analyse our income statement categories to be able to find areas that need improvement.
I am the worst at this.. inevitably I end up with not only the infamous shoebox, but also like 6 different e-mail accounts and paypal/stripe accounts to go through trying to find where expenses ended up.
Made worse by the fact that many of my expenses are in USD, so then I have to track it back to the credit card statement to work out exactly how much I was charged.
Would be easier if I just spent a day a month doing this, I'm sure :D
Spending a day putting things in order would help. You just do it once and then maintain the order.
@rossdcurrie, you made me laugh with this first sentence, well, you aren't the only one feeling that way, i was worst in that as well, it affected my business in a very bad way.
I had to start all over again but this time wiser.
For sure.
I've been cutting back and keeping track of expenses for the last year and it's amazing how much you can save when you really put forward some effort!
Very informative @sme, constant and consistent calculations of your incomes, expenses and profits would tell you if your business is growing or not. Thanks for sharing @sme.
Organisation in the beginning is key. Categorize in simple ways to easily group similar charges will also help when filtering for specific data or expenses... Thank you for the reminder. Upvoted and Resteemed by @cryptoryno33
Oh yeah, it is good practice to keep record of our expenses. It helps to keep a close watch on our budget
Thank you for providing us with very important information, how i wish i can give you a thousand upvote for this post.
Some of my friends thought that steemit is just another social media. I told them that steemit is also business in this cryptocurrency age. Do little (or simple) thing can safe our assets more...
Thank you for this information.
Good ideas are given by you, sir.
That's very important information for the day and lifetime. Every body should as well put it into consideration. Thanks a bunch. :) @sme
Very true great to keep track of it all and keep a diary. Great post. Thanks for sharing :)