How many times have you come across a situation where you and the other person weren't speaking the same language?  I have worked with a variety of clients, and all in all it's not been easy when people have a different outlook on what you're trying to accomplish, compared to what needs to happen.  How far do you cross the line?  How often do you take the assertive role versus the passive role to get the work done?

It ultimately comes down to a team concept, for both parties to agree upon what is the best course of action and stick to it.  Tweak it as you go along, do a thorough revist every few months, and track your progress.  Above all else, the key is to keep it in writing and make sure that everyone agrees to what needs to happen.  Without this, nothing will be accomplished and you're doomed to failure.  Follow up with e-mails, frequently, and be proactive instead of reactive to the situation.  Unless you're the owner, you are a support mechanism to seeing it become a success.  However from personal experience, when you start becoming emotionally invested in the situation, it's time to back away because you do lose sight of what you've been brought in to do.

I just did a QuickBooks training this morning with a young couple who just recently moved to the Houston area, who were on the road to energizing their company focusing in the construction industry.  Working with a variety of construction clients in the past, from small businesses who have just one person working, versus those making several million dollars, this was the MOST organized client I have ever had the pleasure of working with.  From the complexity of the details set up in their Excel spreadsheets, to the capabilities they exude when talking about the industry itself.  I was truly blown away.

The construction industry is one of the most difficult areas to manage from the accounting standpoint, and this couple, without question, know what they're doing when it comes to tracking their cost margins, their profit margins, subcontractors, etc. as well as knowing what it takes to get the job done.  From the bid process to seeing the job completely through, everything is documented every step of the way.  If these same principles could be applied to any business management team, people like me would definitely be out-of-work, since I'm the one people usually call upon to be the clean-up man.  I am looking forward to working with this couple in seeing their business grow into the powerhouse I predict it will become, as long as they never lose sight of the details.

It's always interesting coming across spouses who work and co-own a business together.  When two people live, work, and "love" 24/7, it takes a lot of patience and a lot of understanding, as well as the necessity to actually spend time away from each other to make it work.  As business finances can be a very intimate item of discussion, it is important for both people to be on the same page with the same goals and objectives.  Here are 5 key points to consider if you choose to go into a business together:

1.  Your marriage is more important than a business.  If you are both constantly going back and forth with issues regarding the business and bring them home with you, then it's best someone leave the business in order to keep your home life healthy.

2.  Do not try to hide anything from your spouse.  Keeping secrets about your business' finances is just like keeping secrets about infidelity.  It will come out eventually, and it'll be much worse when it does than if you were up front about it in the first place.  Also keeping your head in the sand doesn't help matters either.

3.  Sit down a minimum of at least once a week to go over where everything is at.  You can make it a business lunch/dinner away from the office and the home, and use it as a legitimate tax deduction.  This way there are no distractions, you see where your business is at and where it's going, and both of you is on the same page.

4.  If you hire an outside contractor to handle your books, whether they are a bookkeeper, accountant, or CPA, check their work and ask questions.  Learn the basics of how they are keeping track of your monies.  This is your livelihood, and you are ultimately responsible for its success or demise.

5.  Take time off away from each other.  It's a rarety that two people can be around each other 24/7 for days at a time.  Whether it's just going out to dinner and a movie, or even a weekend away with friends or other family members.  Just do it.  The break will do you both good, get you re-energized, and ready to focus on the issues on hand.

Best of luck and remember your priorities.

Everyone knows that they avoid seeking help until the pain is just too great, and finances is an area that we as Americans try to avoid altogether.  Although a recent study suggested an increased number of people surveyed believe it's okay exaggerate on tax deductions, the number of people fearing an audit increased as well.  Do you feel the same way?

Death and taxes is something that everyone works to avoid pretty much all of their life.  However, not being able to face these fears head on, doesn't help people's peace of mind.  When partners are involved, especially married couples, it can be even worse.  I've seen it numerous times, and in the end things can be fixed and help bring you to start living instead of denying yourself.

Finances is what we all must deal with, in one form or another.  Just remember that the more informed you can be, the faster you're going to be able to work towards a solution to see a light at the end of the tunnel and stay in the sunshine.

Bookkeeping-Results, LLC, has just added a new book on Payroll Basics for Small Businesses.  To learn more about it, as well as other products, click on the link below.

http://www.bookkeeping-results.com/quickbooks-training-videos.htm

Just a quick note to let those interested in QuickBooks and Business classes, I have updated my listing.  Currently all classes are being held at Brazosport College in Lake Jackson, Texas.  Check out the following link: http://www.bookkeeping-results.com/quickbooks-training-videos.htm.

Other Assets are just like fixed assets, although they are considered intangible.  They have the same purpose as Fixed Assets, and the following demonstrates different types of this category.

Patent Intellectual Property
A patent allows the owner to have a set number of years for which they have exclusive rights to a particular invention for which they can manufacture, use, and sell.  It also protects the owner from others infringing or profiting from their proprietary rights.

 

Trademark
A trademark consists of any figure, letter, word, mark, name, or symbol to help distinguish their particular company/brand from others.  It also protects the owner from others infringing or profiting from their proprietary rights.

Copyright
A copyright gives the owner the exclusivity to make copies, license, and promote a literary, musical, or artistic work in printed, audio, video, etc. works, which extend for the life of the author and for a period of 50 years after their death.

 

Intellectual Property
Intellectual property is thoughts that have commercial value, and includes copyrighted property, patents, business methods, and industrial processes.

 

Organization Costs
Organization costs refers to the cost of the formation of a company, which may include: attorney fees, state incorporation fees, and accountant fees.

 

Goodwill
Goodwill is considered a long-term asset when a company acquires another company’s entire business.  The formula is based upon the purchase cost of the business, minus its value from the tangible assets, as well as the liabilities obtained from its purchase.  It is also considered the value of a business based upon the expected continued customer patronage due to its name, reputation, and other factors which are deemed of value.

 

Amortization
Similar to depreciation, it is the process of expensing intangible assets over a certain period of time.

I hope this helps.  Check out our QuickBooks Training Classes in the Houston area.

The subject of Fixed assets have a time frame of useful life for at least 1 year and must be used in the operations of the business.

The Fixed Asset account refers to items that have a useful life of at least 1 year and are of a specific dollar amount determined by your Financial Policies and Procedures and recommended by your tax preparer.  There is no set dollar value to determine what a fixed asset is, which could be as low as $1.00, up to $5,000.00 and beyond.  These fixed assets stay on your GL for the duration that they are property of the company, even if they have lost their purchased value through depreciation.

Examples of this type of account include: buildings, computer equipment, vehicles, and land.  Leasehold improvements such as a new heating and cooling system you purchase for a leased office space can be tracked as a fixed asset, if it meets the guidelines of the value and useful life pre-determined from your company’s policies. 

 

 

In the case of Land, it cannot be depreciated and cannot lose its purchase value unless it has been determined through a legally recognized outside source and is recorded properly in your General Ledger of Accounts.

I hope this helps.  Check out our QuickBooks classes in the Houston area.

In understanding current assets, first you must remember they have a time frame of liquidity for less than 1 year.  Below are some general descriptions of typical accounts in this category.

 

Accounts Receivable

The Accounts Receivable account is present only when a company is on the accrual basis of accounting, and they have extended credit to customers for which the presence of outstanding invoices is recorded.  When an invoice has been recorded as paid, the account is decreased.  When an invoice has been issued without receiving payment, it increases. 

An example would be if you send out an invoice for $100.00 and your customer doesn’t pay you for 2 weeks, you still have $100.00 in income.

 

Other Current Asset

The Other Current Asset account refers to items that can be converted into cash or inventory within 1 year.

Examples of this type of account are: inventory, pre-paid expenses, and employee loans.

 

Other Asset

The Other Asset account refers to items that are not tangible in an immediate fashion but have a cash value.

Examples of this type of account are: security deposit, goodwill, patents, and trademarks.

I hope this helps.  Check out our QuickBooks Training Classes in Houston.

There are traditional general accounting rules when numbering accounts, and it’s best to at least use 4 characters for each account.  Due to the expected longevity of the business as it continues to grow, it offers a business more flexibility as the addition of new accounts becomes a necessity for numerous combinations.  When developing your own numbering system, it’s recommended to prepare a COA outline and use it as a template for continued use throughout your business’ history, so as to help prevent an unorganized COA layout.

 

The following is a traditional list of the different types of accounts and their numbering range:

 

Asset accounts are classified in the 1000 range.

Liability accounts are classified in the 2000 range.

Equity accounts are classified in the 3000 range.

Income accounts are classified in the 4000 range.

Expense accounts are classified in the 5000 range.

Other Income accounts are classified in the 6000 range.

Other Expense accounts are classified in the 7000 range.

I hope this helps.  Check out our QuickBooks Training Classes in the Houston area.