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Accounting Categories and Process of Entering

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Hot Rolled
Joined
Mar 6, 2010
Location
CA
With a combination of just finishing up taxes and switching accounting programs, I have a bit of a chance to improve the process so was interested in hearing how everyone else is doing it. Originally started out with all kinds of detailed categories, but have slowly minimized it to essentially align with what is needed for tax purposes.

Do you guys mind sharing how you have your categories broken up, screenshots would be great. Looking for a new accountant, as current one doesn't really understand manufacturing so sometimes its like talking to a wall when asking questions.
Ultimate goal is to make it simple and straight forward when entering, enough breakdowns to see what is going on, and organized come tax time.

How about the actual process of ordering to entering. Small shop, no purchasing or accounting dept, its all 99% myself that does that.
When I first started out, I made a purchase and entered it directly in the accounting program, that has since faded away as things have gotten busier. Its currently been more of a every couple months, download the Credit Card and bank statements and go from there, but thats kind of annoying as if its something like Mcmaster, I then have to look was it consumable tools, material, shop repair etc.
 

DanASM

Hot Rolled
Joined
Mar 11, 2019
Quickbooks was the best thing I have done in a while.

No more typing docs out at the end of the day with bad fingers. It has all the reports right at the click of a button. Can send all the needed info to your accountant with a click of a button.
 

Booze Daily

Titanium
Joined
Sep 18, 2015
Location
Ohio
Well, there's really only 2 categories, Income and Expenses.
If you want to break down finer that, I guess it would be up to you to decide what info you want to see.

As far as your purchases, it looks like you pay upfront for everything? In your software I'm sure there is a purchase order module. Maybe when you buy stuff on CC, also create a PO at the same time breaking down the purchase by category. You can usually give a ref. number on the purchase. Then when the CC bill comes, just cross reference it with your open POs and adjust for stuff like shipping etc.
 

CITIZEN F16

Titanium
Joined
May 2, 2021
Is there any decent software these days that isn't cloud based or subscription? You know, where you pay for a program on CD and that is what it costs and all the data is stored on your PC.
 

gustafson

Diamond
Joined
Sep 4, 2002
Location
People's Republic
Your books are your books, use the categories that make sense to you. I use income categories that I need, IRS don't care where the profit comes from

Expenses again, it is what you care about, IRS doesn't care about cell phones anymore, or internet. Do you want to track heat separate from lights? I don't, "Utilities" works for me and the accountant
I want to keep track of several types of stock I buy, so they are sub accounts of 'stock'
first page of expenses in quickbooks income and expense graph
stock a
stock b
payroll
rent
utilities
tools
supplies
insurance
phone/internet
trash

everything that remains is less than one percent of expenses in total, so it just don't matter
 

Stirling

Cast Iron
Joined
Dec 11, 2013
Location
Alberta canada
Quick books can be purchased outright and only on your network/computer this is how I do (one man band. Wife does the books)
OR it can be cloud based subscription. That’s how my brother does it. He likes his the online version manages payroll for cheap (small doctors office)

Either one is cheap and efficient IMO.
 








 
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