If you're looking for a simple way to keep track of your online business income and expenses, then you're in for a treat.
Today I'm going to share with you a super simple Google spreadsheet that I've developed to help me quickly and easily keep track of my online business income and expenses...
... without having to hire a bookkeeper...
... or using complicated, expensive bookkeeping softwares.
Let's dive right in.
An Overview of My Simple Business Bookkeeping System
What It Can Do?
- Record income / expenses categorized by revenue sources, expense categories, vendors and projects.
- Automate income statement generation.
- Allow you to view your finance per individual project.
- Allow you to switch between cashflow and accrual reporting.
Who Is This For?
- Website builders with one or multiple projects.
- Freelancers or small agencies.
- New e-commerce websites with a small number of monthly transactions.
- You should know that this system is not designed for tax purposes.
- It's only for keeping track of your business finance so that you can make informed decisions to grow your business.
- If you need professional advice for your tax reporting, you should look for a CPA.
- As I have limited knowledge about bookkeeping and accounting, some of the terms I use might not be the most accurate.
Step-by-Step Process to Set Up Your Simple Business Bookkeeping System
Step 1. Make a Copy of My Free Google Spreadsheet Template
Click here to access the spreadsheet then click on File >> Make a New Copy to copy it to your Google Drive.
Step 2. Setting Up The Spreadsheet
Now you will need to set up your bookkeeping spreadsheet to fit your business needs.
First off, go the Settings sheet:
- Under Project, list all the projects you have and want to track here. For example, you could enter in the names of your different websites.
- Don't make any changes to the Accounting Type column.
- Under Revenue Source, enter all the different ways you're currently generating revenue from.
- Under Expense Category, you can use the pre-created categories or create new ones.
- Under Bank Account, enter the names all the different bank accounts you have here.
- Under Vendor, enter the names of the people / products / services you're paying money to or receiving money from. You can also go back here and add more vendors as you record new transactions.
Then, go back to the Income Statement sheet and adjust the report according to your setup. Watch the video for instructions.
Step 3. Record Your Revenue & Income
In accounting terms, Revenue and Income are the same but I created 2 separate sheets to track them so I can easily switch between accrual and cash-based reporting.
Here's how they differ:
- Revenue sheet records data you get from your affiliate accounts / e-commerce platforms.
- Income sheet records data that you get from your bank accounts.
The basic idea is that for most affiliate programs, you won't get paid immediately when a new sale is made. Usually there's a 30 - 60 day delay.
So the question is:
Should you record your revenue for the sale on the day it's made (accrual reporting) or the day it's paid to your bank account (cash-based reporting)?
Neither one or the another is better so it's best to have both reports available. This way you can have a better idea on how your business is doing.
Step 4. Record Your Expenses
The sheet is simple enough to be self explanatory. If you're still not sure how to do it, watch my video above.
Keeping track of your business income and expenses is a really important task that you have to do on a regular basis.
So if you haven't gotten a good tracking system set up, give this one a try.
It's really simple and won't take much time to do. And it can give you a ton of clarity and insights on how your business is performing.
How are you keeping track of your business finance? Let me know if you have any feedback about my simple bookkeeping system.