Bookkeeping Basics: What Every Business Owner Should Know

Bookkeeping is more than just data entry—it’s the foundation of good business decisions. Whether you're a startup or growing company, understanding the basics of bookkeeping helps you manage your money, stay compliant, and plan for the future.

Thaisa Ricciotti

5/8/20241 min read

A cluttered workspace featuring a laptop, various bills, a list of subscriptions, credit cards, and a marker. The papers include invoices from different utility companies and entertainment services, with one paper having handwritten notes detailing subscription plans and prices.

Key Bookkeeping Terms

Accounts Payable (A/P): What your business owes to others.
Accounts Receivable (A/R): What others owe your business.
Profit & Loss Statement: Shows your income, expenses, and profit over a period.
Balance Sheet: A snapshot of your financial position—assets, liabilities, and equity.
Reconciliation: Matching your records with your bank and credit card statements.

Monthly Bookkeeping Tasks to Stay on Top Of

✅ Record all income and expenses
✅ Reconcile your bank and credit card statements
✅ Track who owes you (and who you owe)
✅ Organize receipts and invoices
✅ Review your Profit & Loss and Balance Sheet reports

Doing these regularly keeps your books clean and helps you avoid surprises.

Mistakes to Avoid

🚫 Mixing personal and business expenses
🚫 Skipping monthly reconciliations
🚫 Not reviewing your financial reports
🚫 Letting receipts pile up (or disappear!)

When to Hire a Bookkeeper

If bookkeeping feels overwhelming or is taking time away from growing your business, it might be time to get help. A professional bookkeeper ensures your numbers are accurate and your reports are useful—not just during tax season, but all year long.

Final Thoughts

Good bookkeeping is key to a profitable and sustainable business. Even if you’re not doing the books yourself, knowing the basics gives you control over your finances and confidence in your decisions.

Need help staying organized?
At NTR & Associates, we provide professional bookkeeping and accounting services so you can focus on running your business.