Does a Small Retail Store Need Accounting?
Accounting can have a lot of different meanings depending on their actual use, but we can safely say that it is the process of keeping track of the company’s funds that flow in and out of the business. The information will then be compiled for use in creating internal financial reports and so that the owner will know what to put in the tax forms as well.
Even though it can be beneficial for most businesses, a small retail store may not have that much use of accounting. That is because the premise of such a store is quite simple in that people immediately pay for a particular stuff and that’s about it.
Despite the fact that this is normally the case, accounting is still quite important for such stores because it allows business owners to track their accounts payable or the money that is owed to the vendors, tax agencies, and the business’ employees.
If you own a retail store and you do not want to go through the hassles of calculating for your taxes, then you may want to get tax accounting services in Malaysia.
When you purchase something from a vendor or a supplier, they will give you purchase receipts which are invoices or sales slips that tell you some important information about your transaction.
Aside from the fact that you can track your expenditures using purchase receipts, they can also be used to give you information that will help you pay the bills, in case the vendor allows you to pay for the goods over time.
Cash Register Receipts
This is considered to be the main sales record of small retail stores. This is a document that tells the owner of incoming revenue, which is also considered to be the needed information that will help you calculate your profit and loss.
The most common use of cash register receipts is to help you record individual sales. But, apart from that, it also helps you calculate sales totals, tallying the amounts that the store has taken in, especially through the use of checks, cash, or credit cards, and to help divide transactions based on category as well.
Lastly, such receipts can also help you add up the total amounts of sales tax that your store has collected from customers.
Payroll records will help supply the necessary information regarding how much you have paid your employees and how much you have withheld for income and payroll taxes.
The information that is presented in payroll records represents one of your business’ fundamental expenses, which pretty much makes up a huge part of your profit and loss equation.
Bank Account Statements
Bank account statements provide data about how your business transactions are in line with your cash flow. For instance, if you are the sole owner of the business, then you are not obliged to create a separate bank account that keeps your company funds different from your personal assets.
However, things change when your retail business is structured either as a limited liability company or LLC or a corporation. If that is the case, then you will need to maintain a separate business account.