A survey conducted by the Global Entrepreneurship Monitor shows that there are approximately 582 million entrepreneurs worldwide. As a small business owner, you need to understand that bookkeeping is an essential part of running your enterprise. Following basic accounting principles is a recipe for success, despite the size of your business.
As your new startup begins to make transactions, you may need to start keeping records. Having a proficient knowledge in bookkeeping can help you take control of your finances. Small business accounting books can help you prepare to manage your financial health and make sound business decisions. Why is learning accounting so important, you ask? Here are some quick reasons why.
1. Learning Will Help Keep You Organized
A copy of an accounting for small business owners book will teach you ways to track your income and expenditures. To calculate these figures, you need to maintain clean records of your receipts and invoices. Learning how to classify the entries into different categories is essential in calculating your profit and losses. Learning these skills will also help keep your books and records more organized.
2. Learning Can Help You Remain Compliant
Financial laws and regulations vary from state to state. Learning how to balance your books can ensure that you remain compliant with the various government agencies. The IRS may require you to have a business structure and a functional accounting method. Without these, your tax records may be deemed inaccurate, leading to fines and penalties.
3. Learning Bookkeeping Can Help Improve Your Decision Making
A recent study shows that 22.5% of small businesses fail within their first year of operation. Accounting and proper record keeping can ensure that your enterprise does not suffer the same fate. Should you look to bring in more staff? Is there any expense that you may need to cut to save your bottom line? The answers to these and other such-like questions lies in the accounting records that you generate. Learning how to set up and manage your small business accounting books can help you avoid overspending, underspending, or plateauing your operations.
4. Learning Can Help Create Future Projections
Most enterprises calculate business trends and future projections by analyzing historical data obtained from accounting records. Some of the best accounting books for entrepreneurs can teach you how to analyze your financial position effectively. This knowledge may be vital in comparing data and creating structuring your budgets to keep your operations profitable.
5. Learning Can Help You File Your Tax Returns
There is arguably no more dreadful period in the life of an entrepreneur than tax season. Small businesses need to file their financial statements for direct and indirect tax filing purposes. Learning how to manage your small business accounting books can help you understand and confirm your tax filing claims. The first step to filing returns is organizing your financial records.
Learning how to handle accounting for your startup can be intimidating at first. However, it is vital to starting and running a successful business. Accounting books for Entrepreneurs such as ‘How Much Does IT Cost to Make a Donut’ present an exciting and fun way to learn the complex subject.