Author Topic: How do you manage your finances?/Cash based sales  (Read 464 times)

zoochadookdook

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How do you manage your finances?/Cash based sales
« on: January 02, 2019, 11:21:02 AM »
Hey all I've done a cash based sales private party electronics business through college and have managed/tracked my income/outflow with the money manager application on android. I have tracked personal and business expenses through this app and have trouble keeping them separated (mainly due to meeting spending bonuses on chase business credit cards etc). I worked a internship in the summer as a data scientist so I added that income in as well.

Since it's all cash based I generally write up receipts on separate apps but also track the SN/date of purchase and date of sale as well as the gross profit (no space for cost of purchase/sale amount).

I also have a sole prop I'm running separately and will have to do separate income/outflow/write offs for In 2019.

Any tips/tricks/etc on organizing my finances this year?  I had a pretty good year last year but importing all the spread sheets into excel today to start on taxes is driving me nutty.

CareCPA

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Re: How do you manage your finances?/Cash based sales
« Reply #1 on: January 02, 2019, 04:19:24 PM »
Using dedicated bank accounts goes a long way towards making this easier. It sounds like you were mixing personal into the business cards. Not only is this frowned upon (and could cause liability issues depending on the entity type), but it makes things very complicated at year-end, as you're finding out. It's also tough to explain to the IRS if you get audited.
So:
Step 1 - get dedicated business accounts.
Step 2 - get something like Wave (free) or Xero (paid). Connect those bank accounts, and keep track during the year.
Step 3 - ???
Step 4 - Profit (also, not sure if you're old enough to get this joke if you're in college now).

zoochadookdook

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Re: How do you manage your finances?/Cash based sales
« Reply #2 on: January 03, 2019, 08:17:28 AM »
Using dedicated bank accounts goes a long way towards making this easier. It sounds like you were mixing personal into the business cards. Not only is this frowned upon (and could cause liability issues depending on the entity type), but it makes things very complicated at year-end, as you're finding out. It's also tough to explain to the IRS if you get audited.
So:
Step 1 - get dedicated business accounts.
Step 2 - get something like Wave (free) or Xero (paid). Connect those bank accounts, and keep track during the year.
Step 3 - ???
Step 4 - Profit (also, not sure if you're old enough to get this joke if you're in college now).

lol I graduated last month so I'm getting there. I do have a dedicated business account at chase although I've mainly used a in house safe for all cash keeping the last year. It's a pretty garbage method but I'd have instances where I'd need cash after hours/more than my withdrawl limits and it kind of snowballed from there.