Cosmetology and bookkeeping seem to have little in common, but the reality is that all businesses keep records of various types of financial information, and cosmetology is no exception. Determining what type of books you’ll need to keep on file will depend on how many employees you have, as well as how fast you’re planning to expand, among other things. While there are different methods you can use, from notebooks to computer software, it can become confusing and extremely time-consuming, so take time to find a method that suits you.
Small cosmetology businesses don’t require a complicated bookkeeping method. However, simple doesn’t mean non-existent. Even a receipt book and bank statements will suffice, as long as they provide important information, including payment received for services provided, as well as any expenses you pay from your business account for supplies and other expenses. The information recorded must be thorough enough to get an accurate end-of-the-month total on profits and losses. This allows you to track growth, and you’ll need to provide this information come tax season.
Grow With Your Business
As your business expands, so will the amount of bookkeeping you’ll need to do. If you hire employees, you’ll need to maintain payroll records for tax purposes, as well as any other employee expenses, such as bonuses. If you choose to use actual books, you’ll need business payroll checks from your bank, so you can write checks on payday. Most of these come with a memo slip for each check that stays in the book, so you can keep detailed records.
Reasons to Stay Organized
Besides tax purposes, there are several reasons you want to keep books as a cosmetologist. As a cosmetologist, for instance, you’ll want to see if there are patterns where business is slow, so you know when to offer specials. This can be done by reviewing daily profit records and monthly totals. You can record these patterns in a new book alongside current years to track which specific specials are working better than others.
Tools to Use
Deciding which method works best for you depends on your personal preference. If you prefer to keep actual, physical books rather than digital records, you can use carbon copy receipt notebooks and accounting notebooks. If you prefer to keep information on your computer, build your own template or purchase software designed to track profits, losses and payroll. If you’re too busy, you can hire a bookkeeper. But they can be expensive, so make sure you can afford it. Accounting agencies can be of use as well and many provide payroll services as well.
2016 Salary Information for Bookkeeping, Accounting, and Auditing Clerks
Bookkeeping, accounting, and auditing clerks earned a median annual salary of $38,390 in 2016, according to the U.S. Bureau of Labor Statistics. On the low end, bookkeeping, accounting, and auditing clerks earned a 25th percentile salary of $30,640, meaning 75 percent earned more than this amount. The 75th percentile salary is $48,440, meaning 25 percent earn more. In 2016, 1,730,500 people were employed in the U.S. as bookkeeping, accounting, and auditing clerks.