In This Chapter
Discovering simple accounting methods
Keeping track of income and expenses
Choosing user-friendly accounting software or online services
Keeping tax records and taking business deductions
When times get hard economically, it's more important than ever to keep track of expenses, record financial information, and perform other fiscal functions. It's even more important to know some basic accounting procedures, especially those that relate to an online business.
Without having at least some minimal records of your day-to-day operations, you won't have any way — other than the proverbial "gut feeling" — of knowing whether your business is truly successful. Besides that, banks and taxing authorities don't put much stock in gut feelings. When the time comes to ask for a loan or pay taxes, you'll regret not having records close at hand. Even if you sell on eBay, you can't rely on the auction site to keep records for you; your records are kept on My eBay for only 60 days, and PayPal doesn't record payments by check or money order.
In this chapter, I introduce you to some simple, straightforward ways to handle your online business's financial information — and all businesspeople know that accurate record keeping is essential when revenues dwindle and expenses must be reduced. Read on to discover the most important accounting practices and to find out about software that can help you tackle the essential fiscal tasks you need to undertake ...