Tax season will be here before you know it! In fact, starting on January 24th, the 2022 tax season officially begins. While taxes may seem like a scary topic, Lamont Accounting Services hopes to make the task of taxes seem less daunting! That starts with being prepared.
Over the past few months Lamont Accounting has taken you on an in-depth journey all about financial management. We've covered cash, accounts receivable, and inventory. Today, we want to mix things up a bit. Rather than jumping into the next exciting topic, we're going to take a step back and revisit inventory. Specifically, how to manage it.
Last month, we covered all the ins and outs of accounts receivable on a balance sheet. And as we know, properly balancing your assets and liabilities is crucial to your business' success. Businesses of all types, sizes, and ages use balance sheets to ensure that there is more money coming in than out, and ultimately determine profitability.
"Inventories can be managed, but people must be led."
Ross Perot
Whether you're a big business, small business, or somewhere in between, you probably have some experience with a balance sheet. A balance sheet allows you to organize and plan your finances, which ultimately will protect your business and its assets. In short, it is a summary of the financial balances of your business, so knowing how to properly interact with each line item is essential to its accuracy.
"Balance is not something you find- it's something you create."
Jana Kingsfield
In the words of the famous French writer, Antoine de Saint-Exupéry, "A goal without a plan is just a wish." This rings true in almost any aspect of life but is especially relevant in terms of companies and how they plan to make their plans a reality.
Contrary to popular belief, internal controls aren't just for large, multi-billion-dollar corporations. They are crucial to every business in protecting assets and minimizing objective risks. Ultimately, it comes down to accountability.
If you're a business owner, you're well-acquainted with cash flow and how it affects your company. Not only is it a good indicator of performance, but it can also help you make decisions, plans, and gives you a good idea of when it may be time to expand your company.
