PaulChristenson

This is on a different tack...but relates to your business model...i.e. the jobs that you are interested in...
Grading and Excavation Contractor -- Team up on Earthmoving Work with Compact Equipment

Paul in VT

I used to own an ant farm but had to give it up. I couldn't find tractors small enough to fit it.
-- Steven Wright

Dougster

Thanks Paul... definitely an article relevant to my business type, although much more relavent to a multiple employee operation. The concept of two machines (skidsteer and mini-ex) to replace one (full-size TLB) has been tossed around a lot in light construction circles. The Bobcats, Thomases and Gehls of the world would love you to think that the "two compact machine" approach is almost always superior to the "one large machine" approach... while the CATs, Deeres and JCBs of the world (those selling both large and compact machines) aren't quite so sure!

Obviously, the ideal situation is to have ready access to both... but for me, that's a dream that will have to wait until New Hampshire (if I don't go broke first!).

Dougster™

JDFANATIC

The way I handle cash expenditures (have been doing this since 1993), and using regular Quicken, is I set up in my personal checking account a "ATM Cash" category "Cash Withdrawal". Each month, I save receipts, and then add them up. Whatever that amount is, I then change the Cash Withdrawal portion to "Whatever your business name is" usually on several ATM cash withdrawals until the amounts correlate. I then cut a business check (I keep two categories (Draw and Expense) to cover the expenses that month and keep the receipts for 7 years.

So far, I've not had any problem with this system, but I admit I keep really good records.

Cheers

JDFANATIC

JD2210, 62C MMM, 210 FEL w/53" Bucket, Heated Cab, 46" Single-Stage Snowthrower, PTO Spreader, Folding ROPS, FEMCO Sprayer, JD Plug Aerator and assorted other attachments.

Dougster

Thanks very much for the input. I don't use Quicken for personal accounting (I have my own complex array of Excel Spreadsheets)... and I am unclear if Quicken can be used for a sole proprietorship business in lieu of Quickbooks. I'm not sure that's what you are saying here anyway.

I should be clear that I have no problem at all keeping track of how much money comes out of my personal pocket and goes toward cash business expenses. That's never been the issue. The real issue is whether or not it is kosher to be doing this (i.e., taking money out of my pocket for business expenses) at all. Clearly, a business petty cash box would be far superior (bookkeeping-wise) to what I've been doing and I believe it would "fit" with the ways and methodology of QuickBooks much better... at least as I vaguely understand them.

Rather embarrassingly, there is sometimes not enough money residing in the business checking account to pay myself back for these "out-of-pocket" cash business expenses anyway. This personal money then becomes a small, unintended, de facto equity infusion into the business. And, for many reasons, this is not a good thing at all from a proper business bookkeeping perspective.

Dougster™

JDFANATIC

Dougster,

Sorry I wasn't clear with my response. I keep $100 in my business checking (sole proprietorship) and drain it down to that level every month. Because of that, I too use personal cash to pay for expenses, and just submit them to myself each month for payment. I've used Quicken since it came out, and have set up three kinds of "checking accounts", one is my personal, one is the business, and one is for the tracking of invoices. I'm a manufacturer's rep and am paid a commission on sales and use this account to track invoicing for 12 principals (so you can guess this might get pretty complicated, but regular Quicken handles it just fine).

As long as you keep good records and don't mix funds this way of operating is just fine.

Cheers

JDFANATIC

JD2210, 62C MMM, 210 FEL w/53" Bucket, Heated Cab, 46" Single-Stage Snowthrower, PTO Spreader, Folding ROPS, FEMCO Sprayer, JD Plug Aerator and assorted other attachments.

SkunkWerX

Dougster,

Keeping your operating expenses down using things like off-road diesel and a less expensive source for materials are among the good things you are doing.
The fact you have to pay cash for them should , in no way, make you shy away from them. That's the important stuff. The rest is just book-keeping.

The real issue is the "bleeding" as you termed it, and it's an appropriate term.
I would spend 99.999% of my time working on stopping the bleeding.

I know, it's easier said than done, especially during these current times.

Keep your chin up.

Kubota BX2350 and more attachments than I have sense to operate.

Dougster

I guess I never realized that Quicken could be used to manage a small business. I started off using QuickBooks as the result of recommendations in my SBA/Score classes & counseling sessions and never looked back. QuickBooks is great for client management including estimates, invoices, tracking sales, tracking payments, etc... but I never did get that pesky expense management side of it down well enough to use. I should probably pay some local QuickBooks guru to pound that last aspect into my thick head!

Dougster™

Dougster

If I did that, it would only leave 0.001% of my time for executing paying work!

Seriously, I know what you mean. At this point, the biggest equipment purchases are all over with... at least until New Hampshire happens... although a handful of moderately expensive "delayed" projects remain. And I think they will remain "delayed" for a very long time to come. Ignoring return on investment and tax issues for now, it's most important that the business's net cash flow become positive and stay there. Come hell or high water, I've got to stop spending more than I'm making. My business can't stay in a start-up spending mode forever. I think that's what did them "dot.coms" in!!!

Dougster™

JDFANATIC

Dougster,

QuickBooks is a really great accounting package; I wasn't meaning to knock it. To me though, it includes a lot of things a sole proprietor really doesn't need. I'm sure you could set QuickBooks up the same way.

Cheers

JDFANATIC

JD2210, 62C MMM, 210 FEL w/53" Bucket, Heated Cab, 46" Single-Stage Snowthrower, PTO Spreader, Folding ROPS, FEMCO Sprayer, JD Plug Aerator and assorted other attachments.

Chris2520

Dougy , listen to JDF , anyone who has a job that
allows him to play golf all the time , Has Got to be smart....

Chris.....

John Deere 2520 , R4's , 200CX loader with 61 inch bucket and JD Tooth Bar. And Markham 7 tooth. Tooth bar. 46 Backhoe with 16 inch bucket. with Custom made Street Flip pads off a 448 hoe. Foward work lights. Dual rear work lights. Heavy duty Alternator. I-Match , Ballast Box , Frontier BB2060 box blade , Frontier pallet Forks , JD 3 point reciever hitch. and soon A lot more.. and for grass cutting , John Deere GX 255 with 48 inch deck.