Manual System

There are 3 popular commercial manual systems that can be purchased at any office supply store for less than $25.... Ekonomek, Ideal and Dome.  They allow you to list and categorize each expenditure and deposit, and then summarize category totals.  This simplifies the process of putting those numbers into "report" form, whether it be a tax return or a lending agency form.

 

Computer System 

QuickBooks seems to be the most popular.  Price will vary from $100 to $400.  The lower priced system allows you to enter and categorize each expenditure.  The more expensive systems allow you to prepare forms dealing with customers, vendors, and employees.  It is a user friendly, forms oriented system, and has tutorial videos included in the program.

 

QuickBooks totals the categories and provides you with a myriad of reports for managing your business.  In addition to tracking deposits and checks, it has features that let you track customer transactions (invoicing, collecting, a list of unpaid balances), employees (paying employees and tracking your payroll tax obligations to different taxing agencies), and vendors (entering bills, tracking unpaid bills, and paying bills, as well as job or location profitability.  

 

After some help in setting up the system, and some monitoring and mentoring at the outset, you should easily produce good reports in QuickBooks to help you manage your business and minimize your cost to prepare tax returns.

 

Outsourcing

If you, your spouse, and staff lack any one of the time, ability, and inclination to do the company bookkeeping, having an outside accounting or bookkeeping firm do this function makes sense.

 

The bookkeeping function includes writing and recording (categorizing and summarizing) checks and deposits, reconciling bank statements, invoicing customers and tracking amount they owe you, computing employee payroll, and filing reports with various agencies.  "Cloud computing" and paperless processes allow this to be done easily and conveniently (for you) by an outside accountant.

 

All or any part of these "actions" can be outsourced.  Cost will vary with the kinds of actions outsourced and the number of transactions.

 

There are 2 benefits to outsourcing:

1/ You are relieved from spending bookkeeping time and energy that could be better invested in dealing with your customers and service or product.

 

2/ You get useful (timely and accurate) reports.  Oftentimes, the annual cost, including tax preparation cost, is not much more than just the tax preparation cost... that has been made expensive by the incomplete or inaccurate information produced by non-accountants via a manual or computer system.

Here are the 3 typical ways to do the required recordkeeping for your company.