If you'd rather watch the video associated with this, just click here or on the picture below ⬇️
😳No bookkeeping yet? No problem! We have a SIMPLE, FAST & FREE basic cash method you can use to get your business finances organized NOW! 💥
If you’re a small business owner who is also the CEO – Chief EVERYTHING Officer, I get it. I was right there with you not that long ago.
Outsourcing can feel like a luxury. If the timing is not yet right for you to outsource your bookkeeping, but you still don’t have a system that works for you, I have a SIMPLE, FAST & FREE basic bookkeeping method for you to try!
Who doesn't love SIMPLE, FAST & FREE?!
What I’m sharing is bookkeeping based on just cash. This is called “single entry bookkeeping” and it makes us CPAs cringe a tiny bit. There really are two sides to every transaction in your business, so that is why you’ll always see “double entry accounting” in bigger businesses.
Done is better than pending.
I said it. Don’t take me to the perfectionist police over this. 😂
What you’ll need for this basic cash bookkeeping:
· Excel or Google sheet (Google sheets are FREE!)
· Access to your cash transactions (use your bank statement or app)
🌟 Pretty short list, right? You can do this!! 🌟
Now what?
It’s very SIMPLE and FAST.
If you'd like to see a video walk-through of it, you can watch that HERE. In less than 20 minutes, (or even quicker if you speed up the playback speed like I do!), you can SEE this method in action. I am a visual learner so I often take the video option when offered.
I teach both a Basic & Expanded Basic version of this SIMPLE, FAST & FREE basic cash bookkeeping method.
I’ll share the Basic instructions here for simplicity. The Expanded version is covered in the video training.
What's BETTER in the Expanded Version?
I recommend the Expanded method because it’s not much more work & really will provide you with a much better snapshot of your business. These numbers can provide strategic insight into how to run your business more profitably and with greater ease.
The spreadsheet I’m about to walk you through is available as a FREE DOWNLOAD for our Facebook community members. We’d love to have you join the group if you’re a small business who’d benefit from accounting, finance & operational tips, training & strategies.
Basic Version in 5 SIMPLE Steps
Let’s get down to work building this basic cash bookkeeping spreadsheet. It’s super easy so you’ll be done in no time!
1️⃣ Create a blank worksheet in Excel or Google. Enter your Business Name & Time Period to cover.
I recommend a month at a time because this will result in a monthly look at your business’s cash position as well as net cash profit.
2️⃣ Create 3 columns: Date, Description, and Amount.
3️⃣ For your first entry, put your beginning date (I’d recommend the first of a month), a description of “Opening Balance” and the amount. You can get your Cash Balance from your bank app or statement.
4️⃣ Enter each cash transaction (“cash” refers to not just dollar bills, but anything that runs through your bank account directly – including automatic transactions, Venmo, PayPal & debit cards).
Enter "cash in" transactions as a positive amount and payments out of your account as a negative amount.
You can enter these thoughout the month. You’ll be amazed at how helpful this spreadsheet can be if you update it just once a week!
Alternatively, you can download these transactions from the bank monthly. Most banks allow you to export a copy in CSV format, whish is what is used for spreadsheets. I’m all for automating if it saves times!
5. At the end of the time period, enter that date (I’d recommend the end of a month) and a description of “Closing Balance.”
For the Closing Balance amount, total (use SUM function) the Opening Balance amount plus all the cash transaction entries you recorded.
You are done! 🎉🙌🏼🍾✅
Be sure that the ending cash balance recorded matches what your bank says for that date. If it doesn't, go back and enter missed transactions.
That was EASY! How does this help my business?
In some ways, this Basic version seems like just you recording your bank transactions.
However, entering descriptions will help you start to see what kinds of expenses your business incurs as well as the timing during a month when cash comes into and out of the business.
The number one reason that small businesses fail is due to cash flow problems.
Getting a handle on this is critical. So much so, that we were interviewed on The Render podcast about it (Google The Render and see podcast 38) and created a free cash flow projection worksheet. Download it HERE!
WHOA - this gives me a Quick Cash P&L Number?
Total (use the Sum function) the cash transactions for the month, excluding any owner’s draws or investments, capital purchases, or principal debt payments. That will leave you with just the income statement transactions, which is the net P&L number for the time period.
If your number is positive, celebrate because you have a net cash profit in your account! If it’s a negative number, this represent a net cash operating loss for the period.
Knowing your numbers is important becase they are the starting point to take you to where you want to go! Once we know them, we can create simple actionable steps to improve them.
Want to learn the EXPANDED version now? Want to DOWNLOAD our spreadsheet so you can just copy it & enter your own transactions?
Of course, you want the Expanded version! Why wouldn’t you now that you see how truly SIMPLE, FAST & FREE this is?!
The Expanded version takes a few more minutes, but can provided so much more insight by breaking transactions into Cash In and Cash Out categories. When you decide you want to be strategic & get some advisory services, you’ll need these numbers to get started. Your tax advisor will also love you for handing her this instead of a shoebox of receipts. 😉
If you join our Facebook community, you can watch the video & ALSO download the spreadsheet we created for FREE (find it in the Guides section) so that all you have to do is customize it to your business and add your transactions. The video is also available on our YouTube channel HERE.
Our Facebook community (Small Business Finance SIMPLIFIED) is also a great place to ask others for their feedback. It's full of entrepreneurs and small business owners just like you. I share accounting & finance freebies, tips, training, and strategies geared to small businesses.
Just to get you started…
This method is not comprehensive nor is it meant to last you for long. These numbers are a great start though to providing you the golden insight into the next steps to take to help you achieve your dreams.
What if you want the information, but don’t want to do this yourself?
As soon as you can, we encourage you to invest in bookkeeping services. This will give you accurate and complete (double entry!) insight, but also allow you to focus on running your business instead of feeling guilty that you haven’t given this enough time.
We know it’s frustrating when you don't have a background in business finance. You’re running the business & this feels like one more thing to learn. You don’t have to do this alone, nor should you.
With 25 years of experience behind us, our team at VICTORY Advisory Services will empower you with knowledge & simple, actionable steps to put you on the path to achieving your goals.
Interested? Book your consultation with us.
Let's see if we are a good fit for working together. If not, we likely have someone to refer you to.
Ready? Set. Go! You can do it!
Cheering you on!
Joyfully,
Christie
Do you have W-2 employees? Even more $ is available to you!
If you have W-2 employees, be sure to check out the updated and expanded Employee Retention Tax Credit (ERTC) rules that were recently released. Your business could qualify for up to $28,000 PER EMPLOYEE in tax credits. You'll want to be very strategic about applying your PPP funds and selecting your covered period. Here's training on that to help you out, too.
If you haven't already joined our free private Facebook group, Small Business Finance SIMPLIFIED, why not? Join us! I love to meet new people!
DISCLAIMER: This information is shared for educational purposes. Please seek professional advice from your accountant, legal, and tax advisor regarding your specific situation. This does not constitute advice.
Christie Varner, a 25-year CPA, is passionate about helping YOU, small business owner, gain confidence & take control of your business finances so that you can achieve your financial goals without sacrificing your happiness.
When she's not empowering business owners, she's eating Tex Mex, drinking coffee, playing with her Havanese dog, Max, or learning something (and will teach others soon!) from Google, YouTube, or a book!
She'd love to connect with you so reach out & say hi!