Free Tutorial on Bakery Accounting
Running a bakery is a business venture that many people enjoy being a part of. Cakes, cookies and other baked goods make a delicious alternative to other jobs, and owning your own bakery gives bakers a strong sense of freedom. This freedom also comes with a price, and there is a business side to owning a bakery that isn't quite as enjoyable as making baked goods. In addition to standard office functions and inventory management, bakery owners also have to keep detailed accounting records. This ensures resources do not go to waste and helps the bakery remain profitable.
Other People Are Reading
Instructions
-
-
1
Create an itemized budget for your bakery. Break down the different types of expenses in your budget, listing an area for location expenses, payroll, cooking utensils, raw materials and miscellaneous items that will be needed to run your bakery. Project the monthly costs of each item and use the budget as a guide to help keep your finances on track and help cut down on overspending.
-
2
Maintain records and receipts for all of your fixed assets. Bakeries purchase equipment that is used for business purposes, such as ovens, mixers, refrigeration units and stainless steel bowls. Bakeries reuse these materials many times over the life of the business, and they remain fixed at the location. Computers, printers and other office hardware are also fixed assets. Although you make these purchases when the bakery first opens, you can still track them and use them as a tax deduction.
-
-
3
Keep receipts for all of your raw materials. Flour, baking powder, sugar, yeast, eggs, milk and all other consumable items are considered raw materials for a bakery. Because you can count all of these items as a deduction, maintaining receipts for these purchases can reduce the taxable income of the bakery.
-
4
Track your payroll and pay payroll-related taxes on time. Any bakery that has a staff will require payroll to pay those employees. These payments are subject to a number of state and federal taxes, which must be withheld and paid to the government. Use an accounting software program, such as Intuit Quickbooks or Peachtree Accounting, to automatically calculate the taxes that should be deducted from each payroll check. You can use the same software to print checks, complete with year-to-date check stubs.
-
5
Track and use as a tax deduction the lease on the location, telephone bills, utility bills, garbage removal and all standard business costs that recur on a monthly basis. Save all receipts for payments made on these expenses for a minimum of 3 years.
-
1
Tips & Warnings
If your bakery caters or delivers, track additional expenses in reference to the gas and mileage associated with the bakery's transportation.
References
Resources
- Photo Credit Rows of Dark Chocolate Cupcakes in Gourmet Bakery Window image by nextrecord from Fotolia.com
