Manual Bookkeeping - Use Ledger Paper to track entries

Manual bookkeeping is acceptable to IRS. If you choose to make manual entries, you will need some form of spreadsheet or ledger paper to track your entries. If you are not ready to invest in bookkeeping software, but are familiar with a computer, you can create an Excel spreadsheet. If you don't have a computer, columnar ledger paper can be purchased at many office supply stores. However, you should add a computer to your business budget as soon as possible. Once you learn how to use a software program such as Quickbooks or Peachtree, your record keeping task will be easier, quicker and more accurate.

For manual bookkeeping, buy ledger paper with several columns. On the left side of the sheet, you will record the date of each transaction and the vendor or supplier's name. If you want more detail, also record the vendor's invoice number next to their name. Label the right-hand columns with expense categories from your chart of accounts. For example, you might have headings titled Office Supplies, Rent, Utilities, Vehicle, etc. As items are purchased or paid, record the amount in one of the expense columns. You also need to deduct the check amount from your check register.

At the end of the month, total down each column to know how much you spent on specific categories. Begin each month on separate forms. This is the information that you can take to your accountant at the end of the year so that he can prepare your tax returns.

Source: bookkeeping news

June 2, 2016