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.

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.

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.

Purchase Order

Also known as a "p.o." This is a multi-copy form prepared by the company that is ordering goods. The form will specify the items being ordered, the quantity, price, and terms. One copy is sent to the vendor (supplier) of the goods, one copy is sent to the accounts payable department to be later compared to the receiving ticket and invoice from the vendor.

Monday: Each Monday I will post a blog entry about marketing.

Tuesday: The blog entry on Tuesdays will be for the Small Business category.

Wednesday: Watch for a variety of resources to be posted each Wednesday. These may be links to websites full of resources, books I've found interesting, book reviews, interviews with small business people, and once in a while a Q & A section. I'd be interested in knowing what resources you'd like to see in this section.

Thursday: On Thursday the post will be something to do with accounting.

Friday: My free-for-all day! Who knows what you may find on Fridays.

Now what am I going to write about Monday that has to do with marketing? Hmm....

Your accountant is deluged with many other small business owners or solopreneurs and their shoe boxes filled with receipts just weeks before taxes are due to be filed. Your accountant asks if you could just prepare a spreadsheet showing your income and expenses, it would be so helpful. It would also save you money because your accountant will have to charge to do this for you. But you just don't know where to start.

Though accounting can seem overwhelming, knowing some basics is essential for the small business owner. I recommend AccountingCoach.com as a place to start to learn some basic accounting terms and practices.

Then I recommend you hire someone to do some simple bookkeeping for you. Bookkeeping services can usually do your bookkeeping much cheaper and more quickly than you. Hourly bookkeeping rates generally range starting around $25 per hour. Your total monthly bookkeeping charge depends on the type of services you request and the financial records you provide. A copy of a neat and orderly check register will require less work (versus the shoe box of receipts) and lower your costs significantly. You should be able to get accurate and timely financial information from a bookkeeping service for less than $200 a month. Visit my website and find out how I can help you with your bookkeeping.