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2 04, 2020

What is the Families First Coronavirus Response Act?

By |2020-04-01T22:57:15+00:00April 2nd, 2020|Uncategorized|0 Comments

This Families First Coronavirus Response Act (FFCRA) requires that some employers provides paid sick leave and expanded family and medical leave related to COVID-19, effective April 1 and through the remainder of 2020.  The Wage and Hour Division of the United States Department of Labor summarizes key employee rights under the FFCRA. It is essential that employers understand how these changes impact their businesses and how to properly account for, and apply, these added benefits. According to a newly released document from the US Department of Labor, paid leave may include up to two weeks (80 hours, or a part-time employee’s two-week equivalent) of paid sick leave based on the higher of their regular rate of pay, or the applicable state or Federal minimum wage. Details can be found in the poster below:                                           Employers who need to consider this include those with 500 or fewer employees. However, businesses with 50 or fewer employees may be exempt. For more information, [...]

15 03, 2019

How to Adjust Journal Entries

By |2019-02-25T21:48:54+00:00March 15th, 2019|Uncategorized|0 Comments

As a business owner, you want to know exactly when your revenues and expenses occur to keep your records accurate. But often times, recording transactions under the cash method of accounting doesn’t give you an accurate picture of the inflow and outflow of cash. For example, if you bill a client for services within the current month, the payment is expected to be received next month. Even though you will receive the money next month, it would still be recorded as this month’s revenue. Therefore, the outflow and inflow of cash do not always reflect real-time cash exchanges. Adjusting Entries By adjusting entries, you can record expenses and revenues as they occur rather than waiting for the real-time cash transaction. The following are factors that require adjusting entries to accurately reflect your cash flow. Accrued expenses – Expenses that you’ve accrued but have haven’t paid yet. They usually appear as accounts payable liabilities. Deferred expenses – Expenses you’ve already paid but have not consumed yet. Deferred expenses appear on the balance sheet as assets. Accrued revenues – These are revenues [...]

1 03, 2019

Evaluating Your Business’s Financial Health

By |2019-02-25T21:36:36+00:00March 1st, 2019|Uncategorized|0 Comments

Are you aware of how much money your business is making and spending? A good indication to your business’s health is knowing the hard numbers that your business is worth. If you want your company to maximize its profit, it is important to set systems in place to control expenses and stay updated about your company’s finances. The following are a few ways you can track your revenues and expenses. Chart of Accounts – Review your chart of accounts to track transactions, expenses, and profitability. Automate Income and Expense Tracking – Utilize accounting software to link your bank account and credit card activity with your accounting records. All of your business activity will be recorded for the month without the hassle of manually entering in transactions. Accrual Accounting – Accrual accounting is useful for tracking when profit is earned and when expenses occur, rather than cash basis accounting which tracks money based on inflows and outflows. Accrual accounting gives you a better picture of where your money is, whereas cash basis accounting can be misleading, especially if money is owed [...]

15 02, 2019

Ways to Track the Money in Your Business

By |2019-02-01T23:25:34+00:00February 15th, 2019|Uncategorized|0 Comments

As a business owner, you work hard to increase the money in your company. But how do you keep track of where the money is going? In order to maximize the income your business generates, it is important to track the whereabouts of your company’s money to prevent the chances of undetectable leaks or money losses. Poor tracking habits can lead to unnecessary expenses, wasted money, or even theft. The following are a few ways to eliminate the risk of money leaks and maximize revenues! Cost of Sales - All changes in cost of sales and inventory costs should be tracked carefully. Too little inventory will leave customers dissatisfied, and too much inventory could result in wasted cash investments sitting untouched. Payroll – Your employees make up a portion of your expenses. The total cost of labor needs to be tracked, including taxes, benefits, vacation time and other perks. Small business risk making errors when reporting is done inside the company. To avoid detrimental errors, small businesses should outsource payroll services instead. Client Billing – Accuracy and timing are key in client [...]

1 02, 2019

Rules for Keeping Petty Cash in the Office

By |2019-02-01T23:18:36+00:00February 1st, 2019|Uncategorized|0 Comments

Keeping cash in the office can be a convenient, quick way for your employees to get supplies needed for the office or handle small, occasional expenses that crop up. Although keeping petty cash in the office can be beneficial, having cash that is easily accessible will also increase the likelihood money will be abused or stolen. Here are a few dos and don’ts you should know when using petty cash in the office. Establish a dollar limit for the petty cash fund – Keep enough cash to cover occasional funds, but don’t keep too much in the office. Having a large, accessible amount might encourage employees to steal it. Consider allotting a petty cash fund between $50 to $200 for the month. Clarify what expenses the petty cash can be used for – Make sure your employees understand that the money is designated for business-related expenses only. You can write down specific examples such as coffee, paper towels, or other office supplies. Create a log to account for expenses – This is to make sure the money is properly accounted [...]

15 01, 2019

4 Business Structures – Which is Right for You?

By |2018-12-28T19:32:51+00:00January 15th, 2019|Uncategorized|0 Comments

When creating a business, it is important to decide what structure to establish. Depending on the business structure you chose, the accounting and process for filing an income tax return will vary. Of these business structures, the four most common ones are the sole proprietorship, partnership, corporation, and a limited liability company (LLC). Sole Proprietorship – Businesses with a single owner commonly start out as a sole proprietorship. Unless you file paperwork for a different business structure, your business automatically takes place as a sole proprietorship. Within legal terms, there is no distinction between you as an individual and your business. Although you are entitled to all your business’s profits, this also means that you are held responsible for all debts and liabilities. Business loans, taxes, and lawsuits affect your own credit history, income tax, and personal assets (such as your house and savings) respectively. Therefore, pursuing a sole proprietorship may risk aspects of your personal profile and finances. Partnership – When a single business is shared by two or more owners, the IRS considers the business structure to be [...]

1 01, 2019

Important Tax Deadlines for 2019

By |2018-12-28T19:28:45+00:00January 1st, 2019|Uncategorized|0 Comments

Stay ahead with tax deadlines this year and alleviate some tax filing stress! Whether you are spearheading a start-up company or own a well-established business, it is important to have these dates in memory to avoid paying the penalties. For more detailed information about tax forms and dates, contact our accounting team at Bakersmith Bookkeepping Group and visit our web for a hassle-free tax season!   Jan 15, 2019: 4th Quarter 2018 Estimated Tax Payment Due: Those who are self-employed or have other fourth-quarter income that requires you to pay quarterly estimated taxes, make sure to get them postmarked by this date.   Jan 31, 2019: Form W-2 Filing Deadline: Those who have employees need to fill out two copies of Form W-2 for each employee. One copy must be submitted to the IRS and the other sent to the employee by this date.   March 15, 2019: S Corporation and Partnership Tax Returns Due: File your S corporation tax return (Form 1120-S) or Partnership return (Form 1065) by this date. If you need more time to file your tax [...]

20 12, 2018

Accounting for Year-End Fundraisers

By |2018-12-19T18:05:45+00:00December 20th, 2018|Uncategorized|0 Comments

December is a busy month for nonprofit organizations and donors alike. As the year comes to a close, many nonprofits host year-end fundraisers as an opportunity to raise awareness and generate revenue for the organization. Fundraisers can come in many different forms, such as dinners, marathons, concert events, catalog orders, mail fundraisers, and more. In order to run a successful year-end fundraiser, nonprofits need to employ detailed accounting methods. Keeping good records enables you to detect trends that will aid in the success of your current fundraiser as well as future fundraisers, and additionally provides donors looking for last minute tax deductions with proper documents needed for the upcoming tax season. Here are a few tips to better account for these year-end donations and keep accurate records: Donors must receive a receipt from the organization for federal income tax purposes. Charitable organizations are required to provide written disclosures to donors receiving any type of goods or services in exchange for payments. Receipts should include the date of the gift to ensure the gift was delivered to the charity before December [...]

17 12, 2018

Year-End Tax Tips and Preparation

By |2018-12-19T18:06:18+00:00December 17th, 2018|Uncategorized|0 Comments

For many small businesses, the end of the year is a time to evaluate the financial health of your company, close out books for the calendar year, and set your sights on next year’s goals. As December wraps up, 2019 tax deadlines are already making way into our planners so staying informed about your company’s finances and tax options is a crucial step to being prepared for final deadlines and the upcoming tax season. Get a head start before January’s tax prep craze with a few end-of-the-year tips: Defer Your Income: Any income received before December 31 counts as income for the current year. Shifting the income to after January 1 can help you delay payment now and account for it in the following year. However, it is only beneficial to defer your income if you will be in the same or lower tax bracket next year; you could receive a bigger tax bill next year if your deferred income pushes you into a higher tax bracket. If this is the case, accelerating income into 2018 allows you to pay [...]

26 11, 2018

My Small Business has been Hacked, Now What?

By |2018-10-31T17:40:17+00:00November 26th, 2018|Uncategorized|0 Comments

Business tasks are increasingly being fulfilled over the internet, and it doesn’t seem like people are going to turn back to the traditional pen and paper any time soon. As the world continues to rely on online and mobile technology, hackers are upping their game as well. Within the last few decades, hackers have been progressively turning to small businesses as their victims, and it doesn’t seem like they’ll be letting up. When companies are hacked, small business owners risk undergoing permanent financial damages, tainting the company’s reputation, and worst-case scenario, going out of business. What Can I Do Now? Business owners should always take steps to prevent their company from getting hacked. But hacking incidents do happen. If your business has been hacked, here’s what you should do: Limit the damage: If you suspect that you’ve been hacked, you should immediately reset your passwords. Run an anti-virus program to see what files have been affected and delete what has been corrupted. These actions won’t reverse the damage, but at least you can prevent further hacking for the time being. [...]