By Justin Price, MA
Accounting and Hiring Practices
How to set up your books, choose an ownership structure and select staff for your new facility. a daily, weekly or monthly basis. You can create summaries by setting up ledgers (records in which accounts are recorded) and posting information to them. A completed ledger is really nothing more than a summary of revenues, expenditures and whatever else you’re keeping track of (entered from your receipts according to category and date). At any given time you can use these summaries to answer specific financial questions about your business, such as whether you’re making a profit and, if so, how much. You can purchase an accounting software program that will generate its own ledgers as you enter your information (and then automatically generate the necessary financial reports from the same information). Some good accounting packages are Quicken and QuickBooks.
Use Summaries to Create Financial Reports. These reports will tell you spe-
This article is the last in a five-part series on opening your own personal training facility. The previous column examined different methods for marketing your new facility. This column covers business accounting practices; guidelines for determining the ownership structure that best suits your new business; staff hiring; and ideas for future expansion.
Hiring an accountant is imperative when starting up your new business. A good accountant can save you thousands of dollars in tax write-offs related to some of the huge expenses you will incur. Ask other fitness professionals for recommendations and take the time to interview prospective candidates thoroughly. Although your accountant will explain the tax deductions you can make and help you prepare end-of-year records, you must have a good understanding of basic accounting. This knowledge will enable you to track your income and expenses, thereby improving your chances of making a profit. You will also need to collect the financial information necessary for filing your various tax returns.
Collecting Financial Information
The actual process of keeping your books is easy to understand when you break it down into three steps. Keep Receipts. Make sure you have a receipt or another acceptable record of every payment to and every expenditure by your business. Your records must show the amount and date of each transaction, plus any other relevant information. You’ll use these records to create summaries of your transactions.
Create Income and Expenditure Summaries. It’s important to summarize
cific information about your business, such as how much monthly profit you’re making or how much your business is worth at a specific point in time. Financial reports combine data from your ledgers to show you the big picture of your business. Following are the key reports you need to create regularly:
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