What should I know about bookkeeping and accounting when starting a business ?
Answer:
The importance of keeping adequate, legible, complete records cannot be stressed enough. Without records, you cannot see how well your business is going and where it is going. All business transactions should be documented with checks or credit cards. Undocumented cash transactions should be avoided if possible. At a minimum, records are needed to substantiate your tax returns under federal and state laws, including income tax, social security and sales tax laws. It also is necessary to document and substantiate your transactions when you need to request credit from venders or loans from lending institutions. This documentation is also necessary should you wish to sell the business.
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