I was curious to know how all of you handle your accounts payable.
I sole source all of my materials from Miami Corp and they have a copy of my credit card. This card only has a limit of $ 3,000. I pick up the phone and call Miami Mike, place my order and they bill my credit card. Typically my max orders are around $ 1,000 at a time.
My wife once a month reconciles our accounts and pays the credit card balance back to zero. I always keep $ 1,000 cash on hand as well as the business savings accounts. If either one drops below a $ 1,000 I get into a major panic. Typically we keep $ 2,000 grand in one and
$ 2,000 in the other.
Do any of you write checks at the end of the month or have a credit line with your suppliers ? How do you handle your accounts payable and cash on hand ?
Chris
I hate credit lines with companys It was great making the orders got paid for the job done with the material but then you owed a $7000 bill :o
I also deal mostly with Miami with a card on file and some with j ennis and a coulple other vendors fir stainless tubing and fittings ill give them a check but its not often with them . my problem is I run out of my register pages and stuill have plenty of checks. who write checks anymore? ???
I have a Net 30 account with all my suppliers. They all have my debit card # on file. At the end of the month, I call them and authorize payment.
A lot of customers pay me in cash. I take it to the Post Office around the corner, and send off money orders to pay other non-supplier bills.
I haven't wrote a check in at least 3 years.
Quote from: Mojo on March 05, 2013, 07:02:43 pm
Typically we keep $ 2,000 grand in one and
$ 2,000 in the other.
Two million in one account? Good overdraft protection!
Rich
I wished I had 2 million. Heck I wished I had 1 million. I would re-retire again so fast it would make everyones head swim........:)
Chris
All of my suppliers have my debit card on file so when I place an order it comes right out of my business checking account. Years ago, I was on open account and got a nice big invoice at the end of the month. This always freaked me out! I like the pay as you go plan, helps a fella sleep better.
I am on voluntary C.O.D with most of my suppliers and have an open 30 day account with others. When I am real busy a 30 day account is convenient, it saves me time of having to stop what I am doing and write a check for delivery's and I dont have to worry about missing a delivery because it will just be left if no check is needed. But when business slows down I would rather pay for each delivery as it comes in and have it over with, so I go back and forth depending on how business is at the time.
I really distrust credit cards, just recently I found out all my credit card sales over the holidays had not been credited to my checking account, what a hassle. I got it all straightened out, but not after having to run down to the bank and depositing cash to cover the shortage, thank goodness I had the money to do so. I had my machine reprogrammed and all the sales went through, but sill very stressful. I dont like having my credit card on file, nor do I like automatic charges made on the card. Call me a control freak, but nobody sticks there hand in my pocket and takes out money, Ill do that myself thank you.
Great topic! im trying to listen and learn you all so thanks.
I have been lookin around the sba sites for information and get info overload quick.
I have seen quick books for business online and desktop versions not knowing much of either. I thought about learning the new quickbooks at the local university ag extension center. I just need to hear more from the business people directly involved. I believe my startup in this is a little ways up the road, and a bit more learning from you all, and hands on training a must. So is it a big deal to get a business number first so expenses are presently legit, And are bussines bank accounts required to have your tax no. listed. i hope this isnt jackin the thread up
So any jokes are cool
Thanks
I myself would form either a Sub Chapter S corp or a LLC. This way all the tax write offs filter down to your personal taxes. It also gives you somewhat of the corporate umbrella in the event of a lawsuit. You do NOT need a lawyer to set those up. There are many services out there who will do all the paperwork and filing for you with the State. Some as cheap as $ 175. You can then take those papers to the bank and open an account. Sales tax is another issue. You need to apply for a sales tax license through your State. Once you have this then give that number to your suppliers and you wont have to pay sales tax on the materials you buy.
In regards to Quickbooks, it is the gold standard for most businesses. I would consider Quick Books Pro. I just bought their Premier edition ( academic copy ) but my wife got a huge educators discount with her teaching license. If I wasn't able to get that discount then I would have bought the Pro myself. The Premier has all the bells and whistles but would probably be overkill for most small businesses. She wanted the premier edition because she is going to use some of it for her math students/class work.
Chris
In Texas, you can open a business account at any bank with just your SS#. You don't need a Federal Tax ID #, unless you have employees working for you.
Thanks everyone! Im going to have to read up on the 925 irs pasive activity at risk rules, I had initaly thought a LLC disregarded entity would be an option to might be in. I realy need to be looked at the options more, and decide on future complications. Totaly doing an s corp or llc and filing as s corp ?
Homework i guess.
Nolo Press books have all the forms for a LLC. In my state, I simply downloaded their articles for LLC, filed with the Sec. of State, and sent them a few $. Only problem was someone else had a similar name to the one I wanted and even though he was no longer in business, I needed him to sign off on it.
You don't need an EIN, but you can get one on the phone. When a customer wants your W-9, you don't need to give them your SSN if you are sole proprietor, you can give them your EIN, reducing identity theft.
When I started my business, I got the book, "Small Time Operator." I'd read it before and it gets revised every couple of years. It's heavy into accounting and financial part of your business. I highly recommend it. Also get a copy of IRS's Schedule C and use that as a guide when you set up your Quickbook chart of accounts. It will save a lot of headaches come tax time.
But to answer your original question, credit card(s) paid off monthly or I have a "bill payer" from my credit union that will send checks on a recurring or one-time basis.
Mojo I will be coming by to get some cash from you ;D I have the samples you wanted with me. In Tampa now but I have to hit parts of St. Pete and Clearwater so I may not make it until Friday. I'll call you.
I have business account debit card on file with all my suppliers, since I have customers pay material costs in advance I buy the materials for the job using that money, I have long thought that lines of credit or actual credit cards were the downfall of many businesses, If I cannot afford something, I just do not need it!
My business is a sole proprietership, I had considered incorporating but after researching it, todays corporations do not offer the protections they once did and just did not see the benefit, I just had to register my ficticous name with our county clerk to open an account in the business name. I do have an EIN and Sales Tax License
Quote from: Miami Mike on March 06, 2013, 06:43:22 pm
Mojo I will be coming by to get some cash from you ;D I have the samples you wanted with me. In Tampa now but I have to hit parts of St. Pete and Clearwater so I may not make it until Friday. I'll call you.
Your not getting anything till I get my free lunch or dinner. I already give you too much money. :)
I thought you would be home by now. Better get a move on brother. :)
Chris
Quote from: Mojo on March 07, 2013, 06:37:21 am
Quote from: Miami Mike on March 06, 2013, 06:43:22 pm
Mojo I will be coming by to get some cash from you ;D I have the samples you wanted with me. In Tampa now but I have to hit parts of St. Pete and Clearwater so I may not make it until Friday. I'll call you.
Your not getting anything till I get my free lunch or dinner. I already give you too much money. :)
Wow! I
vaguely remember the time when I actually mattered enough to salesmen for them to call on me ;D They even bought me lunch a few times (but if I wanted "Biggie Size", I had to pay the extra 39 cents for the upgrade).
Chris........how 'bout putting an extra bottle of champagne on Mike's tab, and sending it to me? I just wanna see how the other half lives. ;)
Mike. Alled me monday affernoon he left ft myers beach and. Alled me fron lunta gorda in the afternoon. I was in ft myer beach when he called lol we have had real
Bad timing ill never get a free lunch chris. :(
Men you will get the lunch. At this time it looks like late April I will be back. We will work it out and get it done.
The major benefit with an LLC is the liability protection: your LLC gets sued and not your personal assets.
This may not always be the best situation though: There are some days when I would rather loose my house than my Juki LU 582 (which has a smaller bobbin than the Juki LU 583).
Some states like PA and CA charge a fee annually to have an LLC.
Another benefit of having an LLC is that it makes you look more like a 'real' business.
Brmax: You never need to apologize for hijacking a tread. No one else does.
Also, search "Quickbooks" on this forum. I think Quickbooks is the best way to go when starting a business. There's a lot of free learning videos on the net (like youtube) that you can go through, and Intuit's own site, before you need to pay for it, unless you want that kind of formal training.
Wow sofaD: You can remember when upgrades were 39 cents? Your memory is a lot better than mine.
gene