Cash Now

Mar 152010

Getting Cash Now

Even though this is an accounting website, it doesn’t take an accounting degree to know that “Cash is King.” Perhaps due to the recent economic downturn many people are looking to get cash now so that they can survive until the next paycheck. Below is some helpful information about the subject that will guide you towards the best deals. This article is not intended to persuade or dissuade you from receiving a quick loan, but it is trying to make sure you have all of the details.

Ways to Get Cash Quickly

There are a lot of ways to get your hands on some emergency cash; but as with most things in life, not all the ways are built equally.

One option is to visit a payday loan center in your area. These centers are usually willing to give you cash on the spot. They will want to see some personal information: i.d.’s and job information.

If you need cash now, then probably the fastest way imaginable is to go to an online loan center. Some of these centers can have you cash within minutes; all you need to do is fill out some basic information and they will wire you the money. Note: some of these online loans will want you to supply them with your paycheck information. I have seen a few that don’t require you to have a paycheck though. As always be careful when sharing your checking information online with people you don’t know and/or trust.

Ask a friend or family member for a loan. A lot of people overlook this option because it can be embarrassing if approached incorrectly (or depending on the family culture). The truth is, if you really need cash now, talking with a family member may be the quickest and the least expensive way to get it.

Sell something online. If you are like most of the people in this world, then chances are you have a bunch of old stuff that might actually have value to other people. Selling things on e-bay (and other online markets) is extremely easy and can get you some quick cash without the cost of having to pay back a loan with interest.

These are some of the ways to get cash advances now, but it would be a good idea to talk about the advantages and disadvantages of these methods.

Getting cash online is nice because you don’t have to meet with anybody in person. You can supply all the information and receive your money without ever having to leave your house. However, you should be warned that these people are not handing out free money. In most cases you will need to promise them your next check. They are not going to give you dollar-for-dollar either. For example, let’s say you plan on making $200 on your next paycheck (in two weeks). They might offer you something like $180 now in exchange for your next paycheck. If you are in a real bind, then this might not be a horrible idea; however, if there is any way that you can wait, you will be much better off.

Getting cash at a local payday center may in some cases be even quicker than trying to receive cash online. In some situations, you can walk into the center, apply for a loan, and get the money while you are there.

What’s bad about cash now loans.

They charge a lot of interest. Perhaps another example will help. Let’s say that you make $100 every 14 days (2 weeks). You could go online or to a local center and get $82 right now on average. While you may be in dire need of money, this is a lot higher charge than most loans. It turns out to be an 18% interest charge. 18% might not sound that bad to you (especially if you have bad credit). You might be thinking, well, a bank would charge me something like 10-12% and you would be right. However, the bank is charging 10-12% on a yearly basis. The cash now rate on a yearly basis is on average around 485%.

For example if you were to get a bank loan instead of a cash now loan you would get $99.50 now in exchange for $100 in 14 days. I realize that it is not always possible to get a bank loan because of credit ratings and other personal situations. In addition, most banks are not willing to provide loans for a 14 day period (they usually want at least 6 months).

In summary, if you really need cash now then some of these online our local payday centers may be a viable option. However, only use them as a last result and be aware of how much money they will cost you in the long run.

Bookkeeping Business

Mar 122010

Recently there has been a lot of interest in the bookkeeping business. This may be due to the current economic recession and people are looking for any way possible (even accounting) to try and make money. Below I hope to present all the information you could ever want about small business bookkeeping.

Why Bookkeeping?

The truth is most people don’t like accounting. On top of that most people trained in accounting don’t like bookkeeping. I have a Masters Degree in Accounting from the #1 ranked accounting school and let me tell you, they act like bookkeeping is the worst thing ever. So, if accountants themselves don’t want to do it, that means there should be plenty of work to go around.

What does a Bookkeeping Business do?

If you are interested in starting a bookkeeping business then you should at least know a little bit about what your responsibilities will be. As a bookkeeper it is your job to keep track of financial information for the company. For example, if the company that is outsourcing its bookkeeping to you makes a sale, you would need to record the amount of the sale as well as the amount of the product sold. Your entries may look something like the following:

 Cash       $100
                        Sales           $100

Cost of Goods Sold $70
                          Inventory      $70

These entries will allow the company you are working for to know exactly how much cash and inventory they have on hand. It will also allow them to know their current sales and cost of goods sold. This is great information and it can really help companies make better business decisions. Who said bookkeepers were worthless? Honestly though, helping small businesses keep track of their books can be very rewarding.

Back to a bookkeepers’ accounting services responsibilities. The above journal entry is just one of the many entries you would need to make if you had your own bookkeeping business. You would likely need some training in basic accounting information. You can get a lot of this training online for free, or if you have the opportunity try taking an entry-level accounting course. One course on the basics should be all you need to really get your business rolling.

What Else Do I Need?

One of the best reasons to start this type of business is the low startup costs. If you really wanted to get down to the essentials, all you would really need is pencil and paper; however, this is not recommended. You should at least have your own computer and Microsoft excel or a similar open-source solution. Now some people would disagree with me on this, but I would recommend that you become proficient in QuickBooks. I’ve searched long and hard for bookkeeping jobs and almost all small businesses want a bookkeeper who knows how to use QuickBooks. If you have any training on bookkeeping, figuring out how to use this basic accounting software will be a breeze. This is a real way to set your business apart from other bookkeeping businesses.

How Much Can I Expect to be Paid?

This really depends a lot on where you live. I’ve seen ads in the newspaper for bookkeepers offering a measly $8-10 an hour (although this is usually for a full-time bookkeeper and not an out-sourced option). I’ve also seen some places willing to pay $25-$50 an hour for bookkeeping services. Unless you’re already an expert bookkeeper, I would start out charging less with my first clients and then as you gain steam start charging as much as you can. You’d be surprised: sometimes as your price goes up so does the amount of people who want to hire you (they think you are legit, because you are).

When you start out you will probably want to do your bookkeeping for a small business or even a friend. If you don’t know what you’re doing it is best to mess up on smaller clients. There isn’t a whole lot too it once you have done it for a while, but at first you’re bound to make some mistakes.

How to Start a Bookkeeping Business

I’ve explained a lot about what you would be doing as a bookkeeper above, but actually starting the business can be difficult. After you have the skills all you need is the clients. This might take getting a little out of your comfort zone, but at this point you will need to start talking with people. Ask your friend if you can help with her small business. If you’re feeling adventurous go out and talk with some of the local business owners. You might be surprised at how many of them want to outsource their bookkeeping. Note: taking over some of these people’s books can be excruciating at first. Some of these people have not kept adequate records and you may have to dig through old boxes to get the information you need.

Overall having a bookkeeping business can be very rewarding. Not only will you provide small companies with the information they need, but they will be thanking you when tax season rolls around because they will have all of their financial information up-to-date and organized.

General Ledger Accounting Software

Mar 112010

To be able to understand general ledger software you need to know what a general ledger (GL) is. If you already know everything you want to and more about a GL I suggest you skip down a paragraph or two. The GL is the place where most of the important accounting information is gathered. The GL has separate accounts for sales, purchases, current assets, fixed assets, payables and more. For example when a company sells some of its goods it debits cash or accounts receivable on the GL and it credits sales. An accounting system may be more complex than this, but that is the basic idea.

General ledger accounting software is just software that takes care of all your GL journal entries. Instead of writing in the debits and credits by hand you are doing it with a computer. The nice thing about accounting general ledger software is that it will lead you by the hand and help you not to make mistakes on what should be a debit and what should be a credit.

Most software packages come with a general ledger component built in. However, some of the more sophisticated models may still require you to buy the general ledger accounting software separately. Unless you are looking for some custom-built high-tech accounting software I would just recommend buying a normal accounting software package (it should have everything you need).

One big advantage of buying GL software is that it can generate financial reports in seconds. This can come in very handy if you just want to take a quick look at the position of your company. It can also be very nice for showing professional looking statements to potential investors.

Price of GL Accounting Software

I’m always hesitant to offer pricing information on general ledger accounting software for two reasons: (1) the range of the prices is extremely wide and (2) the products vary so dramatically from a complete package to simply a general ledger spreadsheet.

If you really want and you have a fairly simple company you could probably get some form of accounting software that would meet your needs for free. I’ve also seen companies offer to write code and completely customize the software for a company for over $20,000. If you wanted to play it safe you could get Quick Books General Ledger software for around $100. I believe they call it simple-start. This is probably a safe bet because you know you have at least a semi-reliable general ledger accounting software package because of the Intuit name brand.

Invoice Factoring Company

Mar 102010

Looking for a Good Invoice Factoring Company?

So, your company has decided that accounts receivable factoring may be a good option. Below is a quick look at some of the factors you may want to consider when looking for an invoice factoring company.

Initial payment: Most invoice factoring companies will make an initial payment for your accounts receivable; usually somewhere between 60% to 90%. All other things the same, most companies prefer more cash up front to less (in fact cash is probably the reason you are debating factoring invoices in the first place). If you can find a company that will give you 80% or more of the face value of your invoices then you are probably dealing with a reputable company. Note: certain characteristics about your invoices may make a factoring company want to give you less than this even though the company is acting ethically.

Second Payment: After the factoring company has collected the money from your accounts receivable, they will send you a second payment (if they don’t, then you should be really worried). This payment is for the remaining 40% to 10% of the balance. When considering which company to hire, poke around a little bit and see how long it takes them to send you that second payment from the time they receive it from the customer. If they are holding on to it for a significant period of time, then it really doesn’t do your company much good to factor invoices because you are still waiting for cash.

Fee: Invoice factoring companies need to make money as well. They are not running a charity service that simply infuses companies with cash. They charge a fee for advancing your company money. This fee is usually around 2% to 4% per invoice per month. Doing some quick math should show you that this is quite a high rate for a loan, but it may be a lower rate than some other cash advance options. If a company is charging your company much more than 4% to factor invoicing services, then you may want to start shopping around.

Collection Services: Your company has spent its sweat, blood, and tears trying to form relationships with customers so they will continue to shop with you. In fact, you may have decided to give your customers a lenient credit policy so that they would continue working with you; and this may have led you to need to do invoice factoring in the first place. Remember that these factoring companies may not be as accommodating when they are collecting money from your customers. Try to see if your company can still be the one collecting from customers if you are worried about this. Or at the minimum make sure that your customers will be treated respectfully from the factoring company’s collectors.

Hope this gives you some ideas of what to look for when shopping around for a factoring company.

Forty-Four Different Types of Accounting Software

Mar 012010

Most people believe that accounting software is not a very broad topic. However, it turns out that there are about as many different accounting packages as there are people in a small country. Below is a list of all the

different types we could identify. We’ll provide a short summary of each here, but in the future we plan to go more in depth into each category. In fact look for a post on each software category in the future.

Business Accounting Software – This is a pretty broad category within the accounting softwares arena. It basically consists of all of the accounting packages that a business might use. Some popular choices include QuickBooks, Sage, Peachtree, etc. Note that a lot of larger businesses will develop special software just for their business.

General Ledger Accounting Software – Just like it sounds, this software is specifically designed to interact with the general ledger. Most software out there has this integrated within the package, but there are still some places where you can buy just general ledger software.

Manufacturing Accounting Software – Turns out that manufacturers want their own type of accounting software. We’ll dive more into this topic at a later time, but manufacturers need something that will not only keep them in compliance with GAAP, but will also keep track of vital manufacturing information that can give them an edge on their competitors.

Inventory Control Software – This in all honesty is some of the coolest accounting software available. The normal software tracks the information provided by bar codes and scanners. The high-end packages are really awesome; the software actually interacts with RFID (Radio-Frequency Identification) tags to keep track of where your inventory is at all times. Very nice, and very expensive.

Property Software – Like all the categories we are discussing, this one has a lot of different functions. The basic function of this type of software is to be able to keep track of a Landlord’s many properties and tenants while still being able to generate reports that satisfy banks and investors.

Restaurant Accounting Software – Another fun area of accounting. There is actually a whole field of accounting software dedicated to restaurants. Who would have thought? More on this coming in the future.

MRP  Software – Stands for material requirements planning software.  This software is used to account for the type, quantity, and quality of material that will be necessary for the manufacturing process.

Small Business Inventory Software – This is just like the inventory software mentioned above except it is specifically designed for smaller businesses. This usually means that the package is not as detailed, and in most cases not as expensive.

Payroll Accounting Software – This software is specifically designed to keep track of the payroll department of a business. It tracks payroll information, generates checks, and generates payroll reports for management.

Insurance Accounting Software – If you’re not part of the insurance industry you may believe that we’re making up this type of accounting software. Although it doesn’t seem like the Insurance industry would need its own accounting software, there are companies that specialize in making accounting software for these companies.

Trust Accounting Software – Trust accounting is a difficult area, burdened with all sorts of laws and policies. Having specific software for this industry helps, but don’t expect it to solve all your problems.

Warehouse Inventory Software – Similar to inventory software, but designed for larger warehouses.

Asset Software – This type of software can be as basic as you want or as high tech. Some people keep track of their assets with excel, while others have some complicated programs that interact with RFID tags to keep track of depreciation, life, location, and value of each asset (pretty cool software).

Audit Management Software – Just like it sounds, this software industry provides a tool for auditors to manage their audits. Most of the larger audit firms (The Big 4) have their own proprietary software, but some of the smaller firms may be interested in some over-the-counter packages.

Retail Inventory Software – Similar to normal inventory software, but for retailers. On a big scale think Wal-Mart’s vendor managed inventory system that basically forces all of their suppliers to keep their inventory stocked. On a smaller scale, think of a Mom-and-Pop shop that needs some inventory tracking software that will alert them when they need to reorder.

Construction Accounting Software – QuickBooks Premier Edition actually has a specific industry section for construction; that shows you how large of an accounting software industry this is.

Online Accounting Software – This type of software, known as software as a service (SAAS) has become very popular in recent years. Basically the idea is that you don’t need to store your information on local computers. Instead the information is stored on secure servers. This can be beneficial because you can access key information from anywhere in the world, even when you’re on vacation.

Personal Accounting Software – Excel is probably the most used personal accounting software. There are some other popular services out there such as QuickBooks. There is also a wealth of free resources available on the Internet.

Accounts Payable Software – Not a lot to add about this type of software. It simply tracks a company’s accounts payable. Most accounting software comes with this included, but you some still sell it as a separate module.
Accounts Receivable Software – Tracks your accounts receivable. This software can help you reduce your days receivables outstanding.

ERP Accounting Software – ERP (Enterprise Resource Planning) software is a growing trend amongst today’s businesses. The idea is that you have one software package to manage all parts of the business. As you can imagine, these are often custom built because each business is different. However there are a few basic packages that will work if you’ll mold them to your business model.

Fund Accounting Software – Fund accounting is most often used by governments, non-profits, and churches. This is a growing area of accounting software with a few well-established providers, but room for others to move in.

Tax Accounting Software – Almost everyone knows about this type of accounting software. Turbo Tax and Tax Act are some of the more popular services out there. More and more this type of software is moving to the Internet. FreeTaxUSA is a popular online tax service, and the federal filing is free.

Cost Accounting Software – There are some over-the-counter packages that deal with managerial accounting. However, there are no rules when it comes to cost accounting so many companies develop their own accounting packages and consider these packages a confidential, competitive advantage.

Linux Accounting Software – Specifically designed accounting software for Linux.

Project Accounting Software – This is usually used for managing large projects. You would be amazed at how difficult it can be to manage a large project without some software.

School Accounting Software – What type of accounting a school does really depends on its affiliation with the government. If it is a public school then it will likely want to use some form of governmental accounting software. If the school is a private, not-for-profit, then it will probably still want to use fund accounting. If the school is a for-profit entity then it will probably just want to use basic accounting software.

Trucking Accounting Software – Yes even truckers need some form of accounting software. Basically this keeps track of where everyone is going.

Farm Accounting Software – Anytime there is something to keep track of you will see some form of accounting software popping up. Farms are no different; if you think about it they have plenty to manage.

Medical Accounting Software – This is a rapidly developing area. In the olden days, doctors were ridiculed for their lack of business prowess; nowadays they have software built especially for their practices. Some software packages in the medical industry are tracking patient information. Connecting this information with doctors around the world is the future of medical accounting.

Loan Accounting Software – This software handles loan billing, loan servicing, and loan amortization processes. It’s a smaller industry, but it exists.

POS Accounting Software – Point of Sale accounting software comes in very handy for those organizations that sell multiple products. Basically you integrate your point of sale system with your accounting software. This means that for each sale, the accounting information is automatically updated.

Hotel Accounting Software – Basically an accounting package designed for hotels. Surprisingly enough this has been around since the 1980’s.

Partnership Accounting Software – Partnerships have different rules and regulations than corporations. It only makes sense that they would have some slightly different accounting packages as well.
Time Accounting Software – We’re not talking about your average, run of the mill planners here. These are packages designed to track what hundreds of employees throughout the day. This comes in very handy when trying to eliminate employee waste.

Invoice Accounting Software – Software that processes invoices and automatically enters it into the accounting system.

Mortgage Accounting Software – Basically some software that mortgage companies use to track all of their customers payment and billing information.

Stock Accounting Software – Basically a glorified excel spreadsheet. This software tracks whatever stock information you ask it to.

Daycare Accounting Software – Who would have thought that daycares needed their own special accounting software? You won’t see QuickBooks having a special category for these guys, but there is some software out there that keeps track of important financial daycare information and interfaces with QuickBooks.

Municipal Accounting Software – Similar to governmental accounting software. Governments don’t account for their money in the same way that businesses do; so they need their own type of software. Government accounting has a lot of tricky rules that we don’t want to get into in this article, but we will talk more on this in the future.

Opensource Accounting Software – This type of software doesn’t entail a specific type of software, but more about how the software is created. Opensource refers to the fact that the code is available to manipulate the software and usually for free. This can be very helpful if your company is looking to develop custom software, but needs a base to begin.

Database Accounting Software – Most accounting softwares act as a type of database; however when people are looking for this type of software, we assume they are looking for something with a little more storage power than your average software. Database accounting software can be queried and manipulated for data mining purposes.

Rental Accounting Software – If your organization is more focused on renting than selling, then you may want to look for accounting software in this category.

Billing Accounting Software – Most accounting packages come with some form of billing function. However some software packages create the bills and automatically update your accounting ledgers.

Budgeting Software – For individuals budgeting software may just be excel or a personal QuickBooks. However, large companies that rely on budgeting need complex budgeting software. The government is probably the largest entity that uses budgeting regularly. Yes we know it is hard to believe, but the government’s budgeting techniques are rigorous and highly sophisticated. They more than anyone need and use budgeting software.

As most people know, the accounting software does not solve all of your accounting problems. It is simply a tool, but you still need to understand accounting in general, as well as any industry-specific accounting or legal issues. For example if you know nothing about trust accounting and you buy trust accounting software, don’t expect that you will automatically be in compliance with all of the industry standards.

Think this list isn’t comprehensive of all the accounting software out there? Please leave us a message below suggesting a category we missed. Think the list doesn’t provide enough information? Look for an individual, in-depth post for each of these categories in the future.

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