Expense Management Software
Bills and Expenses Best Practices
Set Aside a Regular Time Each Week to Deal with Bills and Expenses
With everything you need to do to keep you business running, it’s easy to fall behind on entering your bills and recording receipts for purchases. But it’s worth it to make time to do it so your records are up-to-date. With WorkingPoint, all the information you provide is translated into easy-to-understand dashboard widgets and reports so you’ll be in a better position to make good decisions for your business today.
Write on Your Receipts
After you make a purchase on a credit/debit card or with cash, quickly jot down why you made the purchase or for which project on the receipt. That way, when you do sit down to enter your receipts, you’ll know just how to categorize the expense.
Create a Receipts Basket
Toss your receipts in the same place every day and then enter them when you can. When you see the basket getting full or if it’s your regular day for entering expenses, you’ll have them all handy and you can enter them one after another. With WorkingPoint’s simple Record Expense form, no matter how you made your purchase, expense management is quick and painless.
What are Bills and Expenses?
In the day-to-day operations of your business, you encounter expenses. Expenses are the costs you incur while running your business, including what it costs to pay employees, buy materials you need for producing your product or service, buy goods to resell, run your home office or your storefront, rent or lease building space, and much more.
Some Expenses You Pay For on Vendor Credit
When you purchase goods and services from your vendor who has extended you credit, your vendor gives you a bill to pay later. The bill is a contract between you (the buyer) and the vendor (the seller). The bill states the details of your purchase, including when you made the purchase, what goods and services you purchased, how much you owe your vendor, and their remittance information. The bill tells you the due date of the bill, that is, when they vendor expect payment. The due date of the bill is typically determined by the date of the bill and the terms of the sale – how many days you have to pay the bill, e.g., Net 30 days (which means you need to pay the full amount of the bill – the net – in 30 days).
Some Expenses You Pay for At The Time of Purchase
If you pay for goods or services when they are received/performed, then you’ll get a receipt for your purchase that states what you bought, when you bought it and who you paid.
Why Do I Need to Manage My Bills and Expenses?
Expense management is a very important part of running a business. By managing your bills and expenses, you’ll have an accurate picture of your financial situation: you’ll know what you owe your vendors and when you need to pay them, you’ll gain insight into how you are spending your money and you’ll be collecting important tax information.
Knowing how much you owe and when you need to make your payments helps you plan for your cash requirements. By seeing what is coming due in the next 7 or 30 days, you can set realistic sales goals for the near term or plan and launch strategic marketing efforts to help boost revenue.
In addition to tracking what you owe, it’s important to track how you spend your money. By managing your bills and expenses, you are recording not only the amount of what you owe and have spent, you are capturing what you spent your money on. Correctly categorizing your purchases helps you track trends in your spending habits, identify areas to cut back or expand, and budget for the future.
When you record the money you’ve spent in the course of running your business, it shows up on your Income Statement: a key financial report that takes your sales and subtracts your expenses to calculate your Net Income or Profit (what your business made after you take into account what it cost you to sell your goods and run your business). Knowing what you really made is important because your Net Income is what you typically pay taxes on. Since expenses reduce your tax liability (if the expense is deductible), coming to this figure correctly is critical for tax reporting.
How Do I Manage My Bills and Expenses with WorkingPoint?
If your vendor issues you a bill to be paid later, use WorkingPoint’s flexible bill and expense management software to create and manage your bills. By creating a bill in WorkingPoint, you can record the details about your purchase, including who you purchased goods from, when you made the purchase, what goods and services you purchased, how much you owe, and when the bill is due. Our easy-to-complete bill form also lets you use the bill to add inventory for products you keep in stock and categorize non-inventory expenses, like shipping charges, rent, or telephone expenses.
Once your bill is recorded in WorkingPoint, you can track when you need to pay your bill. Use our informative Bills List to track when bills are due. If you happen to fall behind, we’ll let you know which bills are overdue so you can take care of them ASAP. WorkingPoint’s insightful dashboard widgets let you see “Who You Owe” at-a-glance, so you can anticipate when your bills are coming up due next.
When it comes time to pay your bills, record your bill payment in your bank or credit card account. WorkingPoint will deduct the payment from your account balance and update the status of the bill for you so you can see what has been paid and what is still open. If you can’t pay a bill in full, WorkingPoint will help you track the balance due so it doesn’t fall through the cracks.
WorkingPoint’s bills and expense management software lets you gain a full perspective on your business, so you can make good decisions for your company.