Accounting Advocate for Individuals and Businesses

Tummarello Blog

Do I Need a Budget?

Monitor your business budget regularly. This is critical to learn about your business expenses and see where your important company profits are being spent. Compare the monthly figures to determine how well your business is prospering. Adjust your spending habits according to how much money you’ve made for the month.  If you are not sure how to read the financial reports or prepare a budget have your CPA or financial consultant teach you!  See our suggestions on how to prepare a budget.

  • Use accounting software such as Quickbooks, Peachtree and Quicken Home and Business.
  • Calculate your projected expenses and profits for the business. Try to do by month – some business are cyclical.
  • Determine the fixed expenses for operating your business. Having all of these in a neat list will make it much easier to generate business reports when necessary. Add expenses such as office space rent, business loan repayments, and insurance payments to your monthly fixed expenses.
  • Figure out the variable expense that will allow your business to run. Regular monthly costs such as employee wages, business supplies and telephone bills may vary from month to month.
  • Create a profit goal for your business budget. This goal will help you to determine the minimum amount of monthly profits required to make your business survive.

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