Professional Organizer Debbie Rosemont recently wrote an article answering the question, when does it make sense to hire a service provider to help? She states:

When your “bill rate” is higher than the cost of the service: If you work in a business, or run a business and can make your business $75 per hour at what you do, then it can make sense to pay someone else a lesser fee (a personal assistant, a house cleaner, an errand service, a bookkeeper) to get things done for you and free up your time to bill clients or bring in new business. In this example, when you perform assistant-type tasks, clean the house, or do your own bookkeeping, when you could otherwise be billing clients, you are essentially paying $75 per hour to have these tasks done!

Read her entire article here.

I read an interesting post by Jean-Pierre Ruiz that I want to share with you. Did you know that 33 percent of new small businesses fail within the first two years? Knowing the 10 common problems small business owners face can increase your odds for success.

1. Not Enough Cash. Most businesses fail because they lack enough cash at first and, as a result, take on excessive debt.  Before you set off on your adventure, make sure that you have sufficient cash to operate for the next 12 months, using your worst case scenario. Then, pay careful and daily attention to your finances; carefully record cash inflow and outflow.  Make sure you are familiar with accounting principles.  No need to become a CPA or even take an accounting class.  Widely available and very affordable software packages, such as Quicken, make it easy to be your own bookkeeper.  Of course, if you can afford it, the services of an accountant who has extensive small business expertise is the still best solution.

Read the entire article here.

What do customer service and accounting have to do with each other? As a business owner, your customer's needs should come first in every aspect of your business - including your accounting procedures. So give your accounting procedures an audit and find out what your customers would like to see improved. Is there something in the way you prepare invoices for your customers or apply payments from your customers that can be improved? Is everyone in your accounting department also trained in how to handle customers and complaints they may have in the billing process?

As a side note, since my business is focusing less on accounting and more on helping service businesses with their self-promotion, Thursday's blog will now be more about customer service. Watch for tidbits on accounting here and there though.

Assets - An asset is merely a thing a company purchases, produces, or receives in trade that it uses to obtain and secure future profits.

Debits and Credits - Too many people suffer from debit and credit confusion.

Liabilities - A liability is something owed to another usually in return for an asset.

Owner's Equity - Owner's equity is the amount of a business not financed by liabilities. It represents the degree of ownership over a business. It is synonymous with net assets and shareholder's equity.

T-Accounts - A t-account is a great visual tool that helps you figure out what happened in an accounting transaction.

For detailed explanation with examples, visit learn-basic-accounting.com.

Basic bookkeeping involves three main tasks:

1. Posting all financial transactions to the proper accounts.

2. Keeping financial records (invoices, sales receipts, and bank statements) in order.

3. Completing the accounting cycle on a regular basis, usually monthly. Often a bookkeeper prepares accounts to be adjusted and closed by an accountant.

Much more information can be found about basic bookkeeping at Learn Basic Accounting.