Running a profitable business is not an easy task, as evidenced by the high failure rate of new businesses. According to the Bureau of Labor Statistics, 18% of new businesses fail in the first year, while up to 65% fail by their 10th year. An important factor in building and maintaining a profitable business is using an accurate budget. A budget carries a lot of weight, so as an accountant, building one might seem daunting. This indispensable duty does not have to be intimidating, however, as long as you know where to start and if you approach it the right way. Identify revenue fotoscool – Fotolia In order to craft an accurate budget, a company’s revenue streams will need to be identified. Accountants should find all sources of revenue and calculate how much money the business can expect to generate. Revenue sources could include services provided, product sales, subscriptions and fees, as well as other avenues. Some revenue could be one-time income, such as asset sales. Other sources may be ongoing, including rent from property assets or monthly and annual fees paid by clients. Determine expected costs After calculating the revenue a company is expected to bring in, the […]
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