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When it comes to managing your small business finances, understanding the debt to equity ratio (D/E ratio) can be a real gamechanger. The D/E ratio = total debt / total equity, and in this article we’ll cover what exactly debt and equity are, how to calculate the ratio, and how knowing it can help you.
Read moreAccrued income, often overlooked, represents money earned but not yet received–important to grasp when using accrual basis accounting. This article is made specifically for small business owners. It breaks down the complexities of accrued income, offering clear examples and actionable insights. This guide is also related to our articles on cash vs. accrual accounting, mastering
Read moreGAAP, or Generally Accepted Accounting Principles, is the standardized framework for financial reporting in the United States. It ensures your financial statements are consistent, accurate, and reliable. In this guide, we’ll break down the key components of GAAP, discuss how it applies to your business, and provide tips on staying compliant with these important accounting
Read moreIn today’s fast-paced business world, managing finances efficiently is super important for startups and small to medium-sized businesses (SMEs). As these companies work towards big goals—like securing deals, raising funds, and boosting profits—it’s crucial to use tools that not only simplify financial tasks but also give you the confidence that everything’s in order. That’s where
Read moreJournal entries (JEs), the foundation of all accounting processes, are used for accurately recording every financial transaction in the account books. Knowing how they work is key in maintaining accurate and reliable financial records, which you need for both decision-making and regulatory compliance. This guide is also related to our articles on understanding journal entries
Read moreUnderstanding debits and credits helps you keep track of every money move in two ways: one account gets debited and another gets credited. This helps you catch mistakes, keep your financial records straight, and understand where your money is going. This guide will help you understand the basics of debits and credits, which accounts a
Read moreIntroduction Accounts payable is what your business owes, but hasn’t yet paid. You receive a bill from your lawyer, independent contractor, or software company – that’s accounts payable. This article will help you understand all the important basics of accounts payable. This guide is also related to our articles on understanding prepaid expenses, bank reconciliation
Read moreCredit memos are documents that lower the amount a customer owes you. They can be created for many reasons, including customer overpayment, damaged goods, pricing errors, promotional discounts, early payment discounts, and service failures. Credit memos are an important factor in managing your Accounts Receivable and, more importantly, your relationships with customers. If your customer
Read moreA year-end bookkeeping checklist is a tool for small business owners to ensure their financial records are complete and accurate before the year concludes. In this article, we’re going to walk you through each step of the year-end bookkeeping process. This guide is also related to our articles on common accounting errors and how to
Read moreAccounts receivable (AR) represents the money that customers owe to a business for products or services they have received but haven’t paid for yet. Managing AR well is important because it helps a business have enough cash on hand for its daily operations and growth. This article will explain the basics and tips for good
Read moreOutsourced bookkeeping lets you focus on growing your business, knowing your money is being handled by experts. It saves time and helps avoid money mistakes. In this article, we’ll discuss the benefits of outsourcing your bookkeeping, how to choose the right service, and the impact it can have on your business’s growth and financial health.
Read moreJust as every ship captain needs a map, every business owner needs a Chart of Accounts (CoA). It’s your financial map, guiding you through the complexities of your business’s financial landscape. The Chart of Accounts is pivotal for recording, organizing, and reporting your business’s financial transactions. This article is related to other concepts such as
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