Accounting

What Stinks About Sweat Equity

Entrepreneur, trust me on this: Do what I say and not what I did. If you’re working for your own company, your startup, for less than what your market salary rate would be, document it. Please. Like so many entrepreneurs, I worked without payment a lot in the early days of my company. I also...

By Tim Berry |

Starting Your Accounting

I’m going to go out on a limb here today in this post about setting up bookkeeping for your new company. I’m thinking that the process is getting simpler every day. Here’s what you do: Bookkeeping, Accounting, Etc. If we just used our own language correctly, we’d call it bookkeeping software, because that’s what it...

By Tim Berry |

Good Debt vs. Bad Debt

I hate debt. I don’t like the feeling of owing anyone money. Though I was repeatedly taught in my youth to avoid debt like the plague, I didn’t listen very well — I was nearly $1m in debt at age 25! Some things are learned the hard way. As much as I dislike debt now,...

By David Gass |

Tax planning in a loss situation

As you develop your business plan, you’ll need to estimate the taxes you will owe. Simple assumption For planning purposes these are based on simple mathematics. Your estimated tax (usually in the profit and loss) is the product of multiplying pre-tax profits by your anticipated tax rate. This simple, powerful estimator is excellent in most...

By Tim Berry |

Successful Budgeting Involves People

This article is part of our “Business Planning Guide”—a curated list of our articles that will help you with the planning process! Successful budgeting goes beyond numbers. It depends on people management. Managing the budget numbers can be simple, but managing a budget takes people, not spreadsheets. While budget numbers are simple, budget management isn’t....

By Tim Berry |

What’s Your Budget?

Budgets are plans. They are spending plans, sales and marketing plans linked to careful projections and resource allocation. Simple math, simple numbers The math of the expense budget is very simple. The content takes work, but not the design of the table. It’s built on common sense and reasonable guesses, without statistical analysis, mathematical techniques,...

By Tim Berry |

Plan vs. Actual, Part 2: Cash Flow and Profit and Loss

Catching trends as they develop A Plan vs. Actual Cash Flow table for the same sample plan shown in Part 1 of this series would show the variance in cash flow and cash balance and how much can change, in the real world, despite good planning. A company needs to adjust to change by keeping...

By Tim Berry |

Cash Is King

In a previous article I talked about business numbers and the critical difference between cash and profits. This article looks at how to plan for cash in a business plan, understanding the critical elements that affect cash flow. You don’t want to be one of those businesses that goes broke even while producing profits. Basic...

By Tim Berry |

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