MINDS4BIZ INCORPORATION

UNLEASHING THE ENTREPRENEURIAL SPIRIT
[You have many questions. We have answers to those business-related questions.]
BUSINESS STARTUP QUESTIONS

D. Keeping track of all financial transactions.

Progression of Events:

14a. What is outsourcing in business?

      Outsourcing is a business practice in which a company hires a third party to perform tasks or provide previously done in-house services. It can be a strategic tool to help companies cut costs, increase efficiency, and focus on core business activities.

Here are some reasons why companies use outsourcing:

Cost Cutting

Outsourcing can help companies reduce labor costs, overhead, equipment, and technology.

Efficiency

Outsourcing can help companies improve their overall performance and efficiency.

Focus

Outsourcing allows companies to focus on their core business activities and the parts of the business they are best at.

Fill Work Gaps

Outsourcing can help companies fill work gaps or help when workloads fluctuate.

Outsourcing can involve a wide range of services, including:

•  Customer Support
•  Manufacturing
•  Back Office
•  IT support
•  Digital Marketing

Creative processes include content creation, graphic design, video production, and voice recording.

Outsourcing can be done with large third-party providers, such as IBM, temporary office workers, or independent contractors.

14b. How can you keep track of all business financial transactions and taxes paid to the government?
      To keep track of business financial transactions and taxes, you can use a recordkeeping system that includes a summary of transactions and supporting documents:

•  Recordkeeping System

      You can use a system that works for your business, but it should clearly show your income and expenses. You can use journals and ledgers, electronic accounting software, point-of-sale software, or other electronic systems.

•  Supporting Documents

      You can keep receipts, bank statements, and other documents to support your transactions. The IRS requires you to keep these documents for at least three years.

•  Recordkeeping Procedures

      You can follow these steps to record transactions:

1. Identify the transaction
2. Get supporting documents
3. Choose an accounting method
4. Document the transaction in a journal
5. Post the transaction to a ledger account
6. Examine and reconcile your accounts

•  Tax Filing

      You can use the Electronic Federal Tax Payment System (EFTPS) to make federal tax payments electronically. You can enroll in EFTPS or request an enrollment by calling EFTPS Customer Service.

      You can also use accounting software mobile apps or business expense tracker apps to help you track business expenses.

14c. What must you know about accounting services and bookkeeping software?

      Here are some things to know about accounting services and bookkeeping software:

•  Accounting Services

      Some accounting services include:

Payroll Processing: Accountants can help businesses automate and organize payroll systems.
Bank reconciliation: This process ensures that all data entered is accurate and that a company’s financial records are correct.

•  Bookkeeping Software

      Some things to consider about bookkeeping software include:

Integrations: Bookkeeping software should be able to integrate with third-party applications.

•  Accounting Methods

      Some accounting methods include:

Accrual Accounting: This method provides a more accurate picture of a business’s financial health.

      Cash Accounting records transactions only after payment is received. It provides a clear picture of a business’s cash on hand.

•  Accounts Payable

      This is an essential aspect of business accounting. Proper tracking of accounts payable is vital for efficiency.

•  Accounts Receivable

      This is the amount of money owed to a company by its customers. It is typically recorded as an asset on a company’s balance sheet.

14d. What business professionals can assist with the hiring process for business startups?

      Business professionals that can help with the hiring process for startups include:

•  Startup Recruiters

      These professionals specialize in finding and hiring top talent for startups. They can work in-house or for a recruitment agency. Startup recruiters are responsible for understanding the startup’s culture, goals, and values and finding candidates who share the startup’s passion for innovation.

•  Recruitment Agencies

      These agencies can help startups find the right people for their culture and goals. They can handle tasks like sorting through resumes and scheduling interviews.

•  Executive Assistants

      These professionals can help with administrative tasks like calendar management, email correspondence, and meeting organization. They can also assist with research and analysis, project management, communication, and coordination.

      Other professionals who can help with hiring include human resources managers and hiring managers.

14e. Who has the best payroll processing software or services?

      The best payroll processing software or service depends on your needs, but here are some of the top options:

•  OnPay: A top choice for small businesses, OnPay offers comprehensive features, easy-to-understand pricing, and automation. It’s also good for larger SMBs and those in vertical industries.
•  Gusto: A top choice for user experience, Gusto is also suitable for people new to running payroll. It offers next-day direct deposit and features like unlimited payroll runs, garnishments, and paid time off.
•  Rippling: A top choice for international payments, Rippling is also suitable for global payroll. Its new features are released quickly and offer comprehensive HR coverage.
•  ADP Run: A top choice for growing businesses, ADP Run is also ideal for companies poised to grow.
•  Intuit QuickBooks: A top choice for payroll and bookkeeping, Intuit QuickBooks is also suitable for QuickBooks users.
•  Wave Payroll: A top affordable choice, Wave Payroll is also suitable for freelancers.
•  SurePayroll: A top choice for a free trial offer, SurePayroll is also suitable for household payroll.
•  TriNet: A top choice for compliance support.
•  Paycor: A top choice for implementation support.
•  Workday: A top choice for enterprises.
•  Papaya: An online payroll solution that helps companies with global hiring.
•  UKG: A good choice for large healthcare organizations with complex payroll and tax filing requirements.

15. Do you need much money to start a business or good credit?

      No, you don’t need a lot of money or good credit to start a business, but you should consider both factors when planning your business:

•  Money

      The money needed to start a business depends on many factors, including the type of business, equipment, office space, and marketing. For example, a small, home-based freelance business might cost as little as $3,000 to start, while a restaurant could cost $400,000 or more. However, starting a business with little or no money is possible if you have a plan and strategy and take advantage of free or low-cost resources.

      Other resources include seeking assistance from Grant Writers, Angel Investors, and Venture Capitalist Groups.

 •  Credit

      A good credit score can help you qualify for a business loan, but it’s not the only factor that lenders consider. Lenders also look at your assets, cash flow, and financial statements. If you don’t have a business credit score, you can use your credit history to qualify for a small business loan, but you’ll need a solid personal credit history. You can build your business credit score by paying your bills on time and in full.

      Securing good business credit can be done in about three to five years after paying business-related bills, building business credit by using business-associated credit cards on time, and seeking assistance on a strategy to make excellent business credit from Dun & Brad.

16. What documents do you need to open a commercial business account at the bank of your choice?

      To open a business bank account, you’ll typically need to provide the following documents:

•  Identification

      Proof of identification for you and your business, such as a driver’s license, passport, or state-issued ID

•  Business Formation Documents

      Documents that show the legal formation of your business, such as a business license, articles of incorporation, or operating agreement

•  Tax ID

      The business’s tax ID number, such as an Employer Identification Number (EIN) or Social Security number

•  Business information

      The business’s name, address, and phone number, as well as the date it was established

•  Ownership agreements

      Agreements that show the names of all the business owners and partners

•  DBA Documents

      If your business has a doing business as (DBA) name, you may need to provide documents that show the other name

      You can open a business bank account online or at a local branch.

 17. What are the pros and cons of financing your startup business utilizing bank loans?

      There are several pros and cons to financing a startup business with a bank loan, including:

Pros

•  Tax deductions: Interest paid on a business loan can be deducted from your gross income, reducing your overall tax liability.
•  Build business credit: Responsible use of a business loan can help build your business credit history and score, which can lead to more opportunities for growth.

Cons

•  High interest rates: Interest rates vary widely depending on your situation and may be high if your credit isn’t the best.
•  Credit damage: Missing loan payments can damage your business and personal credit.
•  Costly: Business loan fees and interest rates can burden startups.
•  Repayment: You must repay the total amount borrowed, plus interest and possibly fees.
•  Secured loans: If you choose a secured loan, your assets can be repossessed if you fail to meet the repayment terms.
•  Growth projections: Most banks want to see a business’s growth projections before financing them, but small businesses often grow slowly.

18. What are the procedures for establishing good business credit?

      Here are some steps you can take to establish business credit:

•  Register your Business

      Registering your business with a business credit reporting agency establishes your business credit file and documents your payment history.

•  Open a Business Bank Account

      This helps establish a payment history with the bank, which can help you build credit.

•  Apply for a Business Credit Card

      Using a business credit card responsibly can be a fast way to build credit.

•  Pay bills on time

      Paying bills on time helps establish vendor relationships and can lead to more favorable payment terms.

•  Keep your credit utilization low

      You can lower your credit utilization score by paying down debt or requesting vendor credit line increases.

•  Get a DUNS number

      A DUNS number provides access to a credit profile that can help you grow your business credit.

•  Monitor your business credit score

      A clean credit report is essential for a strong business credit score and reflects your financial integrity.

•  Get an EIN

      An EIN is used to identify business entities, but you’ll need to use it to apply for business credit and make transactions to build your business credit.