Consistent entries

The key to mining information from any database is consistency in entries.  Any column in a database can be searchable - the value of the search lies in making "free form" entries look the same.  Huh???

In QuickBooks, many fields are defined - name, address, account.  Fields such as Memo are "free form", meaning you can write whatever you want.  If you will need to search that field for information, then you will need to decide on a format for the Memo field.

For example, my real estate clients collect earnest money from their buyer clients.  Rather that create an invoice and then receive payment, I just use the Make Deposit from Banking to enter these checks.  A client may buy multiple properties over a period of time so to identify the property I enter the address in the memo field.  By using the same format every time, I can perform a search function of the memo field and find every transaction related to a particular property.  This is especially helpful in reconciling the liability account to ensure that the liability was relieved after closing.  It is also an easy way to verify that an earnest deposit was made and when.

Fall cleanup

Labor Day is here already, so fall is just around the corner.  Are you ready to do some fall cleaning on your business records?  Too small to spend money on an accounting software program?  Are you tracking your revenue and expenses on a spreadsheet?  This will make your taxes much easier.  Set up a sheet for each month, showing revenues and expenses by category.  What categories?  Well, how about Automobile for gas, oil changes, tires and other repair work; Cost of Goods sold for any items you buy to resell directly to your customers or using to build/repair something for your customers; Supplies - office, janitorial, maintenance; Computer - track you expenses not only for computers but also monthly fees for programs/apps you use; Utilities; Rent (office or storage space); Labor (1099 contractors, not employees); Insurance (health, life, general liability, errors and omissions).  Get in the habit of entering this information every month (or even better, every week) to make tax time a little less trying.

Have a great day and enjoy the upcoming cooler weather (and for those of in the Southeast, hopefully dryer weather).