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Are you Still waiting to get started?In a February 2016 blog we shared and provided guidance about how a food truck does and needs to have a balance sheet. If you are an entrepreneur working on your brand and investment, please view our archives and review the importance of establishing your balance sheet. Now, we would like to share and motivate those entrepreneurs who are still contemplating or wondering about the first steps in getting started. Here you go:
A good laugh and a long sleep are the two best cures for anything." - Unknown Picture: StreetSweets in NYC
The retained earnings statement reports the changes in the retained earnings for a period of time. Retained earnings are used to improve the company through investment in research and development, investment in plant and equipment, paying off debt, and other programs. It is prepared after the income statement because the net income or net loss for the period must be reported in this statement. Similarly, it is prepared before the balance sheet, since the amount of retained earnings at the end of period must be reported on the balance sheet. Because of this, the retained earnings statement is often viewed as the connecting link between the income statement and balance sheet. The trick is to enjoy life. Don't wish away your days, waiting for better ones ahead." - Marjorie Pay Hinckley Source: CorporateFinancialAccounting
Why is it Important?What are long-term investments? It has been defined as an account on the asset side of a company's balance sheet that represents the investments that a company intends to hold for more than a year. They may include stocks, bonds, real estate and cash. Undoubtedly, one of the keys to successful investing is to have a vision for the future, ie, have a long time horizon. Reviews have shown the main key to maintaining a long-term perspective and not deviate at any time the plan are: 1. Keep the focus of concentration as well as maintain the overall allocation of their investment. 2. Select the key long-term investments depending on their merit. It is important not to engage in any changes impulsively. 3. We must not lose sight of the evolution that has the short-term market. It is also important not buy or sell new investments unless you are part of the plan set. While long-term investments are not given much thought during the start-up phases of entrepreneurship, do keep in mind as you plan future goals and expansion of your success. Long term investments are meant to payoff in the future but you must start them in order to capitalize in the next five to ten years. Here is another article worth reading to learn more! Source: Investopedia, Business Insider It's better to walk alone, than with a crowd going in the wrong direction." - Diane Grant Don't spend time beating on a wall, hoping to transform it into a door." - Coco Chanel Easy way to Figure out Market ValueAs an entrepreneur, you may decide to invest into public companies and it's important to know how you would determine their market value. You can calculate a public company's market value y looking at it's share price. For example, let's assume that a company your interested in purchasing has 10,000 outstanding shares and selling them for $25. This means you and investors think the company is worth $250,000. Market value has been defined as what an item sells for in the marketplace and book value is the value an item is carried at in the accounting records (the books). Source: Phillips2ce_CH02
American UndergroundWho is American Underground?
American Underground, a campus that houses small businesses and accelerators throughout Durham and Raleigh, North Carolina, established a bold goal to build the most diverse startup hub in the country. Launched six years ago in the basement of an old tobacco warehouse at the American Tobacco Historic District, American Underground has rapidly grown into the region's most robust entrepreneurial ecosystem. Visit their website to learn more www.americanunderground.com. You can also read the article published by Black Enterprise magazine, Small Biz. Accounting at your FingertipsNow that you understand debits and credits - the chart above describes how they are used in your general ledger accounts. This is your daily cheat sheet at your fingertips. A comfort zone is a beautiful place, but nothing ever grows there" - Unknown Let's talk Budget and View an ExampleHave you incorporated a budget as a key financial tool for your small business?
Budgeting is detailed planning for the allocation of funds in a business. It is sometimes referred to as the financial picture of the business; i.e, how the business plans to spend its financial resources. Whether your business plan is for next year, for the next three years, or for the next five years, budgeting can help you keep on the right road. Deciding to expand your business whether it be by offering a new products or services, a budget is necessary. Because operating a small business is not a cut-and-dried affair, the first budget you prepare often uncovers problems with your business plan and helps you determine whether or not your financial goals are within reach. The budget will also help you focus and select from alternatives to help make your business plan realistic and achievable. In a small business, the year end profit should be large enough to make a return on your investment and return on your own work, i.e., pay you a salary. They key word here is, should! Small Business Notes provides a budget example for you to review.
Start each day with your best foot, thoughts and attitude!" What Does it Mean for my Business?If a company's management could record and report financial data as it saw fit, comparisons among companies would be difficult, if not impossible. Thus, financial accountants follow generally accepted accounting principles (GAAP) in preparing reports. These reports allow investors and other users to compare one company to another. Accounting principles and concepts develop from research, accepted accounting practices, and pronouncements of regulators. When one considers starting a business of their own, they may not actively choose a basis of accounting. However, if you consider to expand the question of whether to move to financial statements that conform to GAAP are bound to come up. Prepare for your future now - understanding and establishing your financial statements are important for your business. |
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AuthorMy mission is to offer the best accounting and operations solutions and tips for entrepreneurs and small to mid-size companies worldwide seeking to close their process gaps with actual solutions. |
We Work to Provide Unique Solutions"Our team of innovative professionals use their knowledge and experience to set your business and team of professionals up for success. Our extensive accounting and operations skills are a start and key tools to company growth, building team cohesiveness, establishing clear purpose and goals, and improving process inefficiencies. Our services are key to businesses of all sizes. We handle providing the detail framework to your business so that you may focus on building your business. |
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