How To Set Up A Tax-Saving Bookkeeping System

One of the most important, but least understood or appreciatedaspects of any business is its bookkeeping or accounting system.And, because very few people know much about the reasons for abookkeeping system, most people are frightened by the thought ofthe work involved in setting up such a system, and the drudgeryof daily maintenance.
There's really nothing complicated to bookkeeping it's as simpleas keeping a daily dairy and' or maintaining your personalcheckbook. At the bottom line, it's simply a matter of recordingyour deposits-your incoming monies-and keeping a record of themoney you spend.
So, the first thing you need to do is open a business account foryour extra income business or endeavors. Generally, this issimply a matter of asking the new accounts teller at a local bankfor a business account registration fee, send it in to theappropriate commissioner, and from there, open you a new businessaccount-complete with imprinted checks.
Drop by a local stationery store and pick up a loose leafnotebook, and a supply of paper. We've always picked up a supplyof index tabs at the same time--either to separate the months orthe accountability sections for each item we sell.
Assuming that you want to make it as simple as possible, while atthe same time keeping it as efficient as is necessary-here's whatyou do and how to do it.
On the first page in your notebook, write on the top line and inthe middle of the page: Monday, January 1st, 1983or whatever day you officially start your business...Then, asyour orders come in, if by mail, as you open your mail-jot downstarting from the left side of the page, the amount youreceived-dash-for what-from whom, and their address. The pagemight look like this:
Monday--- January 1 1983
$ 14 Tapes 100 S.W Fee-Barton 10 Hong Kong Dir #261 10 " " #261 3 Whsle Prt Dir #49 70 Hot Line Lst--Morgan
TOTAL INCOME $207 EXPENSES 0
That's all there is to it, and boiling it all down, it amountsto recording what you receive and what you spend.The next entry, immediately under that first day's entry mightlook like this:
$207 Deposit 11 Printer-for copies 10 Sec & riches thru R Est #302-Rogers( 75010) 3 Simplified annual M.O bkkp Sys (21104) 10 Money Magnetism-Kline (88033) 36 R.W Fee-Magnuson (10067 6 Manual on Bookselling-#291-Magnuson (10067 15 display Ad- Smith 948089) 22 Ideal Ofc Supplies-printer paper
TOTAL INCOME $80 Expense $33 Deposit $207
And then, carry on with this recording of the money you deposit,receive and spend each day with similar entries for each day ofthe week-every day Monday Thru Saturday for each week. It'ssimple uncomplicated, and a positive record of your businessactivity.
Then at the end of each month, transfer this daily information toone of the low cost bookkeeping registers that your taxconsultant or accountant can work from. These people won't workfrom your daily dairy, ad will not transfer the information yourecord in it to a formal bookkeeping register without chargingyou a small fortune. it's not that big of a job, ad if you do itafter te close of the business on the last day of the month, itwill take at the most a very few minutes. Then, of course, whenyou're ready to do your taxes, you simply give your bookkeepingregister to whoever is going to do your taxes, and you're homefree.
The bookkeeping register you'll need can be any simple columnarnotebook-we use an "Ekonomik Register,Form RL-17"available in a number of different styles and sizes from EkonomikSystems-PO Box 11413-Tacoma,WA 98411. All you really need is somesort of notebook with a number of columns marked off, a titlewritten at the top of each column, and a record of te moneyreceived for each day relative to the product or service eachcolumn represents. Then at the end of each month, you can simplyadd the totals from each column and you'll instantly know howmuch money you took in from each of your offers.
Beyond te date column, will be your record of expenses or moneyspent. Again, you should title each of the columns you'll beentering figures into, and then record your expenditures foritems falling into those categories. Then at the end of eachmonth, it's a simple matter to add the total from each column andknow exactly where you stand relative to profit or loss-how muchyou took in compared to how much you spent.
Bookkeeping and/or accounting is a very simple and should notscare you. Just keep it simple, ad up-to-date.