Assets & Bookkeeping

The Big picture

Hopefully, when it comes to taking stock of your business, you have managed to stay on top of your book for the whole year. Even if your records aren’t perfect, with one month left before taxes are due, now is an excellent time to get a handle on your accounting. Most people think of determining your revenue and your expenses at this time. It’s also important to remember your assets and liabilities toward year-end. Knowing what is owned by the business is an important insight not only for this tax season but for tax seasons to come. Assets may even include things you wouldn’t ordinarily consider. For example, have you listed your cell phone as an asset?

Appreciating Your Assets

Your business may have more assets than you think, and it is vital to keep an eye on them. At its most basic level, an asset is anything that holds financial value. You can think of it as an investment in your business. These can be both tangible and intangible. Tangible assets can include anything from buildings you own, computers, vehicles, to numerous other things. Intangible assets include things like goodwill, patents, and intellectual property. These intangible assets can often be harder to quantify. When it comes to assets and tax season, the IRS will consider a few things. The asset must be owned by the business and used for that business. You must be able to determine that it has a useful life longer than one year as well. If all these criteria are fulfilled, you have yourself an asset!

Keeping Track

You will keep track of any assets, tangible and intangible, on your balance sheet. Since these assets have a useful life, they are subject to the whims of time and will often lose value. They may eventually need to be replaced once they become inoperable. While you own them, it isn’t all bad news since you can write this loss of value off by depreciating the asset. Once the business can use the asset, it will begin depreciating. Note that it does not need to be in use, but you should access it readily. Remember to keep track of dates for future reference. Once you have taken stake of your assets and written off any possible depreciation, you will be ready for tax season.

by Nick Climan – Content Creator at Half Full Marketing

How Alron Can Help Your Business

If you’re in over your head, get help from a professional accountant. Someone who knows the world of business numbers will ensure you aren’t missing anything important, and save you from major headaches down the road. Here at Alron Bookkeeping, Inc., a subsidiary of Alron Enterprises, Inc., we simplify accounting for you, so that you can focus on what matters most: growing your small business. Let our bookkeeping specialists handle your accounts and put your mind at ease. Contact us at 321-951-7626. We look forward to working with you!