Cash vs Accrual Accounting: Explained for Normal Humans
Cash basis tracks money when it enters or leaves your bank. Accrual tracks money when it is earned or owed. Here is the plain-English guide to both.
Resource library
Straight answers about your books
Written by Dave the way he explains things across a table: plain language, honest numbers, and no scare tactics. Start with whatever question is keeping you up.
Basics
Do I need a bookkeeper if I already have a CPA?
Yes. A CPA prepares your taxes and advises on strategy, usually looking backward once a year. A bookkeeper keeps your records accurate every month, which is what your CPA files from. They're different jobs, and your CPA will be glad you hired one.
How to Pay Yourself as an Owner: Draws, Salary & S-Corps
Sole proprietors pay themselves with owner draws, while S-corp owners must take a reasonable W-2 salary plus distributions. Here is the plain-English guide.
The chart of accounts, explained like a filing cabinet
Your chart of accounts is the filing system every transaction lands in, and it decides whether your reports mean anything. Here's how it works, why the default setup fails most businesses, and what a good one looks like.
The monthly bookkeeping checklist (what "done" looks like)
A month of bookkeeping is done when transactions are categorized, every account is reconciled, invoices and bills are current, payroll matches the provider, and reports are produced and read. Here's the full checklist, in order.
What does a bookkeeper actually do?
A bookkeeper records and organizes every transaction in your business, reconciles your accounts, and produces the monthly reports that tell you whether you're making money. Here's the full job, in plain language.
Cost & hiring
1099 vs W-2 Rules: How Small Businesses Get It Wrong
Misclassifying workers as 1099 contractors instead of W-2 employees triggers severe state penalties in NJ and PA. Here is how to keep your business compliant.
12 questions to ask before hiring a bookkeeper
Ask about certifications, reconciliation habits, who does the work, access boundaries, communication speed, and how they'll explain your reports. Here are the 12 questions that separate professionals from disappointments, with the answers to listen for.
8 signs it's time to hire a bookkeeper
You dread the books, tax season hurts, the bank balance surprises you, and receipts live in a shoebox. Here are the 8 signs owners recognize themselves in, and what changes when the books get handled.
DIY bookkeeping vs hiring it out: the honest math
DIY bookkeeping makes sense when volume is low and you actually do it. The math flips when your hours are worth more than the service costs, or when 'doing it yourself' quietly becomes 'not doing it.' Here's the honest comparison.
Do I even need a bookkeeper? 5 questions that answer it
You need a bookkeeper if you can't answer 5 questions about your own business. Here's the self-test I give owners, whether you do the books yourself or your wife does.
How much does bookkeeping cost for a small business?
Most small businesses pay somewhere between $300 and $800 a month for outsourced bookkeeping, with simple books coming in lower and high-volume or catch-up situations higher. Here's what moves the number, and why it's usually less than owners fear.
Is a bookkeeper worth it? Where the return actually comes from
Yes, a bookkeeper is a new expense. The return comes from 5 places: your reclaimed hours, cheaper tax prep, caught errors, better payment terms, and cash flow you can see.
Should Your Spouse Do Your Business Bookkeeping?
Having your spouse do your business bookkeeping often causes friction and delays. Here is how to know when to hand the books to a professional.
The Hidden Costs of Bad Bookkeeping: What It Actually Costs
Doing your own books badly or putting off cleanup feels free, but it silently drains thousands of dollars. Here are the 6 hidden costs owners pay.
Fixing your books
12 bookkeeping mistakes small businesses make (from someone who fixes them)
The bookkeeping mistakes that cost small businesses real money: skipped reconciliation, overstated income, misclassified loans, borrowing from payroll taxes, and mixing personal spending. Here's each one, why it hurts, and the fix.
7 signs your books need a cleanup (and how one works)
If your reports don't match reality, your accounts haven't been reconciled in months, or 'Ask My Accountant' is your biggest category, your books need a cleanup. Here are the signs, and what a professional cleanup involves.
A year and a half without books: a real cleanup, start to finish
A service business owner ran a year and a half with no real books. Here's the full cleanup, step by step, and the surprise inside: he was profitable and didn't know it.
How to get your books ready for tax season
CPA-ready books mean every account reconciled through December 31, income complete, loans and payroll recorded correctly, and documentation for anything unusual. Here's the checklist, and the timeline that makes January calm instead of terrible.
Mixing business and personal expenses (why it hurts, how to stop)
Mixing business and personal spending blurs your profit picture, weakens your tax position, and can pierce the legal protection your LLC exists to provide. Here's how the damage works and the 4 moves that fix it.
My books are years behind. Now what?
Books that are months or years behind get fixed the same way: gather the records, rebuild each month, reconcile everything, and land on current books. Here's the honest process, timeline, and cost logic, from a bookkeeper who has rebuilt worse.
Scared to Look at Your Numbers? What Bookkeeping Dread Means
Being afraid to look at your business numbers is normal. It is called the Ostrich effect. Here is why the dread is always worse than the reality.
Why Bank Feeds Lie: What Bookkeeping Reconciliation Means
Clicking green buttons on software bank feeds is not bookkeeping. True reconciliation compares your books against monthly bank statements to $0.00.
Reading your numbers
Cash flow basics, or why profitable businesses go broke
Profit is an opinion about a period; cash is what's in the account when payroll runs. Here's how profitable businesses run out of money, the timing traps that cause it, and the simple weekly habit that prevents it.
How to read a profit and loss statement (without an accounting degree)
A P&L reads top to bottom: revenue, minus cost of goods sold, equals gross profit; minus operating expenses, equals net profit. Here's each line in plain language, plus the 5 questions a P&L can answer about your business.
Profit First cash flow: separate bank accounts for owners
Why profitable small businesses still run out of cash. How to use separate bank accounts for taxes, profit, and payroll without complex spreadsheets.
What Is a Balance Sheet? Why Small Business Owners Need One
A balance sheet shows what your business owns, owes, and what is left over. Here is why the balance sheet matters more than your P&L when applying for loans.
Strategy
How Seasonal Businesses Survive the Winter Cash Slump
Seasonal businesses survive slow winter months by calculating their true off-season burn rate, banking summer surpluses, and establishing separate reserve accounts.
How to Hand Off Clean Books to Your CPA at Year-End
Handing clean, reconciled books to your CPA eliminates surprise tax-prep cleanup fees, avoids missed deductions, and gets your return filed on time.
Invoice payment terms: the setting that decides when you get paid
Payment terms are the days you give a customer to pay, and most owners never chose theirs. What net 30 and net 60 really cost, and how one bakery fixed it with zero pushback.
Philadelphia BIRT & NPT: Cross-River Guide for Suburbs
If your South Jersey or PA suburban business does work in Philadelphia, you likely face city BIRT and NPT taxes. Here is how to track cross-river numbers.
Quarterly Estimated Taxes: How to Stop Getting Surprised
Quarterly estimated taxes do not have to be a surprise. Learn the 4 deadlines, safe harbor rules, and how clean monthly books keep you ahead of the IRS.
When minimizing your taxes costs you the loan
If you are self-employed and your tax strategy is built to show as little income as possible, it is working against you the day you apply for a mortgage or sell the business. From a bookkeeper who spent years reading self-employed tax returns from the lender's side.
Why You Never Borrow from Payroll Taxes: The IRS Trap
Borrowing from employee payroll withholdings during a cash crunch triggers personal IRS liability that bankruptcy cannot wipe out. Here is why and what to do.
Industry
Bookkeeping for consultants: retainers, project margins, and taxes
Why consultants and small agencies struggle with cash flow despite high billable rates. How to manage retainers, project margins, and quarterly taxes.
Bookkeeping for contractors: how job-site money gets away from you
Contractor books fail in 2 directions at once: subs get paid twice while finished work never gets billed. What contractor bookkeeping has to do differently, from a real cleanup.
Bookkeeping for medical practices: why busy clinics run out of cash
Why independent medical, dental, and therapy practices struggle with cash flow despite full treatment rooms. How to reconcile insurance payouts, copays, and overhead.
Bookkeeping for real estate investors and landlords
Property-level books come down to 4 things: class tracking so every dollar lands on the right property, capital improvements separated from operating expenses, rent and deposits reconciled, and a net operating income you can actually trust at refi time.
Capital Improvements vs Repairs: Landlord & Investor Guide
Repairs can be deducted immediately, while capital improvements must be depreciated over 27.5 years. Here is the IRS BAR test and safe harbor rules.
Contractor bookkeeping best practices: job costing, apps, and cash flow
The 5 bookkeeping best practices for contractors and trades. How to connect Jobber, Buildertrend, or QuickBooks Projects without losing project margins.
Medical practice bookkeeping best practices: EHRs, payouts, and HIPAA
The top bookkeeping best practices for independent medical, therapy, and dental practices. How to handle SimplePractice, TherapyNotes, and Jane without HIPAA risk.
NJ sales tax for contractors: Form ST-8 vs. taxable repairs
How New Jersey sales tax applies to contractors. When labor is exempt under Form ST-8 capital improvements versus taxable repair services.
Stop avoiding your books.
Book a free consultation. Dave will look at where your books stand, tell you what they need in plain language, and you will know if it's a fit. If you're embarrassed about the state of things, don't be. He's seen worse.