Questions
Answers to questions small business owners ask about bookkeeping, payroll, taxes, and running the numbers side of a business.
Do I Need a Bookkeeper If I Have an Accountant?
Usually, yes. Accountants and bookkeepers do different jobs. Your accountant handles taxes and financial strategy. A bookkeeper keeps your records current so your accountant has something accurate to work with.
Read answerMy Last Bookkeeper Left My Books in Bad Shape. Can You Fix Them?
Yes. Cleaning up after a previous bookkeeper is a significant part of what we do. Misclassified transactions, unreconciled accounts, missing records. We sort it out and get you back to accurate books.
Read answerHow Do I Set Up QuickBooks for the First Time?
Start with the right version, build a chart of accounts that matches your business, connect your banks correctly, and set up a few rules. Get these basics right and QuickBooks actually works. Get them wrong and you'll spend years fixing mistakes.
Read answerWhat's the Best Way to Track Inventory for a Restaurant?
Count weekly, track waste daily, and compare what you should have used against what you actually used. The gap between those two numbers tells you where your food cost is leaking.
Read answerWhat Restaurant Expenses Are Tax Deductible?
Almost everything you spend to run the restaurant is deductible. Food costs, labor, rent, equipment, supplies, marketing, even the music license. The key is tracking it properly and categorizing it correctly.
Read answerHow Do I Set Up Job Costing for My Construction Business?
Track every cost against the job it belongs to. Labor hours, materials, subs, equipment. Compare what you bid against what you spent. Without this, you won't know which jobs make money until it's too late to do anything about it.
Read answerHow often should I update my books?
Weekly is the standard for most small businesses. Monthly is the minimum. Going longer than a month means losing context on transactions and letting errors compound.
Read answerWhat's the difference between bookkeeping and accounting?
Bookkeeping is the recording of financial transactions. Accounting is the analysis and interpretation of those records. Both matter for small businesses, but they serve different purposes and happen at different rhythms.
Read answerHow do I know if my books are a mess?
There are clear warning signs: bank accounts that don't reconcile, surprise tax bills, financial statements that don't match reality, and transactions piling up uncategorized. If you're avoiding your books, that's usually confirmation enough.
Read answerWhat financial reports should I be reviewing every month?
Start with the profit and loss statement, balance sheet, and cash flow statement. Add accounts receivable and payable aging reports to track money coming in and going out. Monthly review catches problems while they're still small.
Read answerShould I use cash basis or accrual accounting for my business?
Most small businesses do fine with cash basis because it's simpler and matches what you see in your bank account. Accrual makes more sense when you need an accurate picture of profitability across longer billing cycles or carry significant inventory.
Read answerWhat records do I need to keep for the IRS?
Keep documentation for all income and expenses reported on your tax return. This includes bank statements, receipts, invoices, payroll records, and asset purchase documentation.
Read answerHow long should I keep business receipts and invoices?
Seven years is the safe default for most business records. IRS requirements vary from three to seven years depending on the situation, and some documents like formation papers should be kept permanently.
Read answerCan I do my own bookkeeping or should I hire someone?
You can do your own bookkeeping. Whether you should depends on your time, your consistency, and whether the hours you'd spend are worth more doing something else. DIY works early on but often becomes a burden as the business grows.
Read answerWhat happens if I don't keep good financial records?
Poor records lead to expensive tax prep, missed deductions, IRS audit risk, and cash flow surprises. Banks won't lend without clean financials, and selling your business becomes nearly impossible.
Read answerHow do I separate my personal and business expenses?
Open a separate business bank account and get a business credit card for business purchases only. The setup is simple. Building the habit of keeping transactions in the right accounts is the harder part.
Read answerWhat's the best way to track business expenses?
The best expense tracking system is one you'll actually use consistently. Separate business and personal finances, capture receipts immediately, and reconcile weekly instead of waiting until month-end.
Read answerWhy do my bank statements never match my books?
Usually it's timing differences, missing transactions, or data entry errors. Outstanding checks, unrecorded bank fees, and duplicate entries are the most common culprits.
Read answerWhat does it mean to reconcile my accounts?
Reconciling means comparing what your bank statement shows against what your accounting software shows, then fixing any differences. It confirms your books match reality.
Read answerHow do I know if my business is actually making money?
Your income statement tells you whether you're profitable, but only if your books are accurate. Cash in the bank doesn't mean the same thing as profit. Look at what's left after all expenses, including paying yourself fairly.
Read answerI'm months behind on my bookkeeping. Where do I start?
Start by gathering all your bank and credit card statements for the missing months. Check for urgent deadlines like quarterly taxes or pending loan applications, then work through reconciliation one month at a time starting with the oldest.
Read answerCan a bookkeeper help me catch up on years of messy records?
Yes. Catching up on neglected books is one of the most common reasons small businesses hire a bookkeeper. The process involves reconstructing transactions from bank records, categorizing expenses, and reconciling accounts month by month.
Read answerHow long does it take to catch up on a year of bookkeeping?
A year of catch-up bookkeeping typically takes one to four weeks of work time, though this varies based on transaction volume, documentation quality, and business complexity. Cash-heavy businesses and those with disorganized records take longer.
Read answerWill I get in trouble with the IRS for falling behind on my books?
Falling behind on bookkeeping itself doesn't trigger IRS penalties. The problem is what happens next. Messy books lead to inaccurate tax returns, missed deductions, and late filings. Those are what create real trouble.
Read answerWhat documents do I need to provide for catch-up bookkeeping?
Bank statements are the foundation. Credit card statements come next. Receipts, invoices, and payroll records help fill in the details, but you don't need perfect documentation to get started.
Read answerHow much does it cost to clean up messy books?
Cleaning up messy books typically costs $500 to $3,000 for most small businesses. The actual price depends on how far behind you are, transaction volume, and whether documentation still exists.
Read answerI haven't done any bookkeeping since I started my business. Is it too late?
No, it's not too late. Bank and credit card statements can be used to reconstruct your records even if you never tracked anything. The longer you wait, the harder it gets, but catching up is almost always possible.
Read answerWhat's the difference between catch-up bookkeeping and cleanup bookkeeping?
Catch-up bookkeeping addresses a time gap when your books stopped being maintained. Cleanup bookkeeping fixes quality issues like miscategorized transactions and accounts that don't reconcile. Many businesses need both.
Read answerCan you help me get my books ready for tax season if I'm behind?
Yes. Catch-up bookkeeping exists specifically for this situation. We gather your records, categorize and reconcile everything, and get your books into shape so your accountant can file your return.
Read answerWhich QuickBooks plan is right for my small business?
The right plan depends on user count, inventory needs, and whether you track project costs. Most small businesses do fine with Simple Start or Essentials. Plus is worth it only if you manage inventory or need job-level profitability.
Read answerCan you help me migrate from QuickBooks Desktop to QuickBooks Online?
Yes, we regularly help businesses migrate from Desktop to Online. The process involves transferring your data, cleaning up historical entries, and getting you comfortable with the new system.
Read answerWhy aren't my bank transactions importing correctly into QuickBooks?
Bank feed issues usually come from broken connections, duplicate handling, or account matching problems. The fix depends on whether transactions aren't showing up at all, appearing twice, or landing in the wrong place.
Read answerHow do I reconcile my accounts in QuickBooks Online?
Reconciliation compares your QuickBooks records to your bank statement. Start with your statement ending date and balance, then match transactions one by one until the difference is zero.
Read answerWhat's the best way to categorize expenses in QuickBooks?
Consistency matters more than the specific categories you choose. Use QuickBooks defaults as a starting point, keep things simple, and match categories to tax return line items for easier year-end prep.
Read answerHow do I set up job costing in QuickBooks Online?
Enable the Projects feature in QBO Plus or Advanced, then configure your chart of accounts to track costs by category. The software setup is straightforward but the structure you choose determines whether your job reports are actually useful.
Read answerCan QuickBooks handle inventory tracking for my business?
QuickBooks Plus and Advanced can track inventory, calculate cost of goods sold, and set reorder points. Basic retail or wholesale operations work well with the built-in features. More complex needs like manufacturing or multi-location tracking may require third-party integrations.
Read answerHow do I fix mistakes I made in QuickBooks?
Most QuickBooks mistakes can be fixed by editing the original transaction or creating a journal entry to correct it. The right approach depends on whether the transaction has been reconciled and whether you've already closed the period.
Read answerShould I connect my bank account to QuickBooks or enter transactions manually?
Connect your bank account. Bank feeds save hours of data entry time and reduce typing errors. You'll still need to review and categorize transactions, but you'll start from accurate data instead of hoping you entered everything correctly.
Read answerHow do I run a profit and loss report in QuickBooks?
In QuickBooks Online, go to Reports and search for Profit and Loss. The report generates with default settings, but customizing the date range and comparison columns makes it far more useful.
Read answerWhat's the difference between QuickBooks Simple Start, Essentials, and Plus?
The main differences are user limits, bill management, and inventory or project tracking. Most small businesses need Essentials or Plus. Simple Start works for freelancers but runs out of room fast.
Read answerCan my accountant access my QuickBooks file?
Yes, and you should set this up. QuickBooks Online includes a free accountant user slot specifically for this purpose. QuickBooks Desktop requires sharing the file directly or sending an accountant's copy.
Read answerHow do I set up classes and locations in QuickBooks Online?
Go to Settings, then Account and settings, then Advanced. Enable class and location tracking there. The harder part is deciding how to structure them before you start.
Read answerWhy is QuickBooks showing a different number than my bank account?
The most common reasons are timing differences, duplicate transactions from bank feeds, or reconciliation issues. Your QuickBooks balance includes transactions that may not have cleared the bank yet.
Read answerHow do I track tip income and tip-outs for my restaurant?
Track tips daily using your POS system or a written tip log, record all tip-outs to support staff, and run tips through payroll since they're taxable wages. Both credit card and cash tips need documentation.
Read answerWhat's the best way to handle cash management in a restaurant?
Start with consistent register banks and count cash at every shift change. Reconcile to your POS daily, deposit frequently, and limit who handles cash to create clear accountability.
Read answerHow do I record daily sales from my POS system in QuickBooks?
Record a daily sales summary from your POS end-of-day report rather than individual transactions. Break out payment types and use a clearing account for credit card sales to match deposits when they arrive.
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