Are you an e-commerce business owner who is feeling a bit overwhelmed by all the ecommerce accounting tasks you need to keep on top of? If so, don’t worry – you’re not alone! Keeping on top of your e-commerce accounting can be a daunting task. It’s important to make sure that your finances are in order. To help you get started, we’ve compiled a list of five important e-commerce accounting tasks that you should focus on.
1. Categorize all transactions for ecommerce accounting.
One of the most important things you can do for your e-commerce business is to ensure that all transactions are properly categorized. This will help you keep track of your spending and income, and will also be helpful come tax time. You can categorize transactions by type (e.g., advertising, inventory, shipping, etc.), or you can create a more detailed system if needed. The important thing is that you have a system in place so that you can easily track and manage your finances. To help you categorize, software such as accounting by Wave can be very helpful.
2. Maintain a business budget for ecommerce accounting.
Another important task for e-commerce businesses is to maintain a budget. This will help you track your spending and ensure that you are not overspending in any one area. When creating a budget, be sure to include all aspects of your business, such as advertising, inventory, shipping, and more. Once you have a budget in place, be sure to stick to it as much as possible so that you can keep your finances in order.
3. Stay up-to-date with taxes for ecommerce accounting.
Ecommerce businesses are required to pay taxes just like any other type of business. Therefore, it’s important to stay up-to-date with your tax obligations. This includes knowing what types of taxes you need to pay (e.g., federal, state, local), as well as when they are due. Additionally, be sure to keep track of any tax deductions or credits that you may be eligible for so that you can maximize your tax savings. To help you with this, software such as QuickBooks can automate a lot of the tedious ecommerce accounting tasks for you by tracking business expenses and mileage. Additionally, an accountant or tax professional can also help you with your more complicated tax needs.
4. Distinguish between returns and chargebacks.
If you sell products online, then it’s important to know the difference between returns and chargebacks. Returns typically occur when a customer is not happy with a product and wants to send it back for a refund. Chargebacks, on the other hand, occur when a customer disputes a transaction with their credit card company. As an e-commerce business owner, it’s important to know the difference between these two so that you can properly handle them when they occur.
5 . Practice accurate recordkeeping.
Finally, one of the most important things you can do for your e-commerce business is practice accurate recordkeeping. This means keeping track of all financial documents related to your business receipts, bank statements, etc for your ecommerce accounting. This may seem like a tedious task, but it’s important to have accurate records in case there is ever an issue with your finances. Additionally, accurate recordkeeping will help come tax time because you will have all the documentation you need in one place.
As an e-commerce business owner, it’s important to stay on top of your accounting tasks. This can seem like a daunting task, but it’s essential for keeping your finances in order. To help you get started, we’ve compiled a list of five important e-commerce accounting tasks that you should focus on:
- categorizing all transactions,
- maintaining a budget,
- staying up-to-date with taxes,
- distinguishing between returns and chargebacks,
- and practicing accurate recordkeeping.
By focusing on these tasks, you’ll be well on your way to keeping your e-commerce business’ finances in tip-top shape!