JannaG's Journal

There are several. These pitfalls can lead to cost-inefficient use of finances and time. One of the most common pitfalls is not understanding the difference between a balance sheet and an income statement. These two records keep track of different information, but a lot of business owners mix them up and use them interchangeably. The other common mistake is not tracking expenses consistently from month to month and not keeping a record of all expenses. This can lead to very inaccurate financial statements . It can be tempting for business owners to do their own bookkeeping because it seems like a simple task. However, there are several common pitfalls that business owners should be aware of before they decide to take on bookkeeping responsibilities. A few of these include: -           Failing to keep track of all transactions made by customers and suppliers -           Not recording jour...

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Creditors of your business cannot go after your personal assets in the event of a lawsuit against your business if you’ve set it up right . An important thing to note is that it's necessary to have an LLC agreement and an operating agreement . The reason for this is that creditors can still go after your personal assets if they don't have a written contract, but they CANNOT do so if they have a written contract. You want to avoid them piercing the corporate veil and avoid having the company as your alter-ego. When you form an LLC, you're creating a legal entity that protects your personal assets from any legal liability that your business incurs. But it's important to realize that there are two different kinds of liability: direct and indirect. Direct liability is when you're personally responsible for something like breaking a contract or violating someone's rights. Indirect liability is what happens when the actions of your business directly cause harm to ...

This can be very simple or very complex. It really depends on how many owners there are, what the filing status is with the IRS, and what type of entity you have. Do you have an LLC, partnership, or corporation ? Are there multiple owners? Are there different classifications of owners? Are there stock options? What is the value? Is the entity registered with the IRS as a partnership, S-corporation, C-corporation, or pass-through? When we think of businesses, we usually picture the typical corporation: a person or group of people who have created an enterprise that they hope will make money. However, this is only one of the many legal structures available to a business , and how they are taxed can be even more varied depending on how it is set up. Depending on where you are, you should probably speak with an accountant, tax advisor, or attorney . When you're starting out, it's easy to think of your business as a sole proprietorship or partnership. After all, that's ...

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There are many benefits. A business plan is a written document that describes your business and its goals. The basic purpose of a business plan is to help you make decisions about how to run your business and where it should be headed. Having a plan helps you focus on what matters rather than figuring things out as you go. In the long term, having a business plan can help you grow your business and generate profits. A good one can help you secure funding from investors because it shows that you have a clear vision for success and the steps needed for achieving it. The benefits of having a solid business plan include: -           Helps you focus on what's important, like targeting the right market and taking the appropriate steps to achieve growth   -           Helps you raise capital by demonstrating that you have a firm grasp on your future in your industry When you need help ...

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Strategy and business model are often used interchangeably, but they do not mean the same thing. A strategy shows you how to achieve what you want to achieve. A business model is the process by which a company makes money. They are both about the "what" and "why" of your company. A business model describes how a company makes money, including the makeup of its revenue, where it gets its sales, and how it invests or reinvests in itself. A strategy is more about the "how" and "what." It describes what you do with your business model—it's a plan for how you execute your business model to achieve your goals. The problem is that sometimes people will use these terms interchangeably when they mean two different things. They'll say they have a business strategy, but they're describing something that's more of a business model, or they'll call it their company's business model when they're really talking about its strategy....

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