One of the easiest ways of getting yourself into fiscal trouble when owning your own business is ignoring bookkeeping basics. It is absolutely necessary to follow a routine in recording any and all expenses and deposits immediately so that their recording is not forgotten. It takes up too much time to try and go back and remember what was spent and for what if checks are written without being properly recorded (or debit and/or credit cards are used without being recorded at the time they are being used).
First of all, it is important to learn the basics of bookkeeping, especially certain accounting terms. Accounts payable are the bills that the business has yet to pay. Often referred to as AP, this is the amount you owe other people or entities, such as if you have an open account or an unpaid credit card bill that you used in purchasing office supplies. On the other hand, accounts receivable is monies owed to you by someone you completed work for who has yet to pay you. Referred to as AR, these monies are especially important to keep track of, since this is how your business pays for itself by paying you and your associated APs.
Your bookkeeping does not have to be complicated--simple tracking of APs and ARs will do. Software programs are available to help, however, some of them can be expensive for starting out. Any office supplies or office equipment should be also kept track of since your business will receive credits or deductions for them at tax time through that equipment's depreciation. Depreciation is the amount that the value of the equipment decreases since it is aging and losing its worth over time.
It is extremely important to keep all receipts for anything relating to your business since you will need them for preparing your taxes and for any audits that may arise in the future. Record every expense relating to your business so your tax preparer can help you accurately and give your business the most deductions that you are entitled to.