Bean Counter Bookkeeping

With tough times hitting every business it is important to know what costs can be cut while still maintaining great quality and service to your customer.  The best place to start is by reviewing your Profit and Loss Statement for any expenditures that seem out of line or too high. 

Here are the steps to running a Profit and Loss report from QuickBooks.  I like to run it for the last month then add a Year-to-Date column and lastly a Percentage of Income column.

Step 1 - Go to Reports

Step 2 - Choose Company and Financial

Step 3 - Select Profit and Loss Standard

Step 4 - Under the Dates drop down menu select Last Month (this will give you your last full month of data)

Step 5 - Select  Modify and under the section "Add Subcolumns for" click the box Year-To-Date and % of income

Step 6 - Click OK

This report will now have three columns.  Review your % of Income column for any percentages of 5% or more.  These are the costs that take up more than 5% or more of your income.  Ask yourself why these cost are so high?  Are they negotiable?  Can you drop a service you are not using any more? 

By reviewing this report at least every 3 months you will have a better handle on the costs to run your business and what expense takes up the most of you income.