You have just started your own small business and though you know you need to keep track of your business expenses and income, you are not ready to invest money or time into a program like QuickBooks, and you are not comfortable enough with Excel to set up a spreadsheet. You are looking for a simple, manageable manual bookkeeping system that will meet your needs. A 12-column ledger bookkeeping system might just be the solution for you.
Prepare your pad. If the pad you have came with a perforated section across the tops of the pages, carefully remove the paper above the perforation. This will leave the top of the back page exposed. It is on this page that you will write the names for your columns. If your pad does not have perforated sections, you will need to rewrite the names of the columns on the top of each page.
Name your columns. Think about your business and list the expenses you incur in that business, assigning them columns with the most common expenses in the closer columns. Do you purchase inventory? Do you have a lot of marketing expenses? Other expenses to consider include insurance, gas, cell phone, Internet, office supplies, postage, rent and commissions. Write the column names in pencil, as you may need to make adjustments at first.
Enter your bank balance and subsequent transactions. The pad will have a column for your running total. Enter the reconciled bank balance from your starting date in the first row, then begin entering your transactions. Enter a brief description of the transaction, the amount as a debit or credit, depending on whether it is an expense (debit) or deposit (credit), and update the running total. Then input the amount in the proper column on the same row to categorize it.
Add the columns at the bottom of the page. When you reach the bottom of the page, or the end of the month, add the columns and put the page totals along the bottom. Carry these totals to the top of the columns on the next page. These totals will then be included in the totals at the bottom of the next page for a running total for each expense category. If you prefer, run two totals along the bottom; one for the page (or month) alone, the other for the cumulative running total. At the end of the year, the totals will be calculated and ready for use in preparing your tax return.