Managing Business Expenses
Skin care parties, color make overs, holiday open houses.
Party! Party! Fun!
It’s easy to have fun, but surprisingly it’s also easy to record your business expenses. Not only is it easy, it is also vital. Unless you are truly in the business to simply have a good time, knowing how much you’ve spent and what you’ve spent it on could be the difference between realizing an income and just having fun.
What expenses do I need to record in Pink Office?
Any expenses that are NOT part of an inventory order should be recorded in the “Money” section of your Pink Office account. Wholesale purchases, sales tax paid, shipping and section 2 are all recorded on your tax info report and are pulled straight from your inventory order once it is either imported or manually entered. Those don’t need to be re-entered in the money section. Items purchased at a store such as cotton balls, windex, paper towels, wash cloths, and pens can and should be recorded in the “Money” section as expenses. Babysitting, wardrobe, and MK connections orders should be entered as an expense as well. Here’s a walk through on how to do that. Don’t forget you can create any expense type that you like.
Where do I enter my commission check as income?
Click the “Money” tab and then click “Income” and enter your monthly commission check there.
What report should I use to file my taxes?
The best report for your taxes is the “Tax Info Report.” This will give you a comprehensive view of the money you’ve had as both income and expenses. If you’d like to see your top expenses and maybe where you could cut back take a look at your “Top Expenses” report.
How do I pay myself from my business?
You can pay yourself in product by creating a personal use invoice just like any other sale. You can also pay yourself by writing a business check to your personal account, or make an online transfer. Any time you pay yourself from your business account to your personal account create an expense. This will help you track exactly how much money you are really making. Many consultants use the 60/40 split. 60% of their pretax income goes back into the business and 40% is income. This only works if you are operating with a full inventory and if 10% is enough for your business expenses. You might be better served with an 80/20 or 70/30. You’ll just have to decide what works best. Business loan repayments must come from your income. Once your loan is paid off you can take an actual income.
One of the most important things to remember is that though you are having fun and helping people you need to be able to realize an income. If you keep a close eye on where you’re spending your money you’ll make better choices and keep yourself in business. As always if you have any further questions about how to use Pink Office to help make your business strong contact our support staff by clicking the pink bubble in the bottom right corner when logged into your Pink Office account.
Originally published at https://blog.pinkoffice.com on November 14, 2017.
