Bookkeeping Tip #11 for Small Businesses

 (Photo credit: Wikipedia)

What is cash versus accrual?  The answer is this week's tip from Clear View Business Solutions.  We all want to know how much money we've made, and you can get to either a cash calculation or an accrual calculation.  But it's best to know how much money you've truly made.

Cash accounting means you count how much actual money you've received, not counting any unpaid invoices you've sent out or bills you haven't paid yet.

Accrual accounting means you've factored in the money owed you and the money your business owes.

Which is better?

To get the truest idea of your business' progress, go with accrual.  It factors in outgoing and incoming money, whether or not there's a delay in receivables or payables hitting the bank.  With cash accounting, you do see your dollar bills, but depending on your current business activity, that figure could mislead you.  Want to know more? There are some related articles below that you might find helpful.

 Be sure to leave a comment here or on our Facebook Page.  You can even Tweet us @clrvw!  We care about what you think of our blog post!  And if you think your business would benefit from bookkeeping help or even advice from experts, call us at 520-544-0177 or email us at deb@clrvw.com or janine@clrvw.com.

Happy bookkeeping!

Related articles

• Cash and Accrual

  ---

• Cash and Small Business Bookkeeping

  ---