Book Image

Efficient Accounting with Xero

By : Jay Kimelman
Book Image

Efficient Accounting with Xero

By: Jay Kimelman

Overview of this book

Xero empowers business owners to gain insights into their business and performance and collaborate seamlessly with their accountants and tax professionals. This book goes beyond the basics and explores the more advanced Xero features, techniques, and best practices for managing sales taxes, budgeting, and reporting. You’ll begin by diving right into Xero, setting up a bank feed, and exploring its power while experiencing just how easy it is to use. The book will guide you in setting up Xero the right way to ensure that you succeed in each of your transactions. As you progress through the chapters, you’ll learn what spend money and receive money transactions are and be able to easily send invoices and collect receivables or payments, collect and pay bills, and even track your business assets with Xero. Toward the end, you’ll be proficient at producing powerful reports, giving you the keys to running or advising any business. By the end of this Xero book, you’ll have gained the confidence to add a company to Xero, set up the bank feeds, reconcile the transactions, send invoices, and pay bills, ending up with beautiful financial statements.
Table of Contents (27 chapters)
1
Part 1: Hitting the Ground Running
7
Part 2: Handling the Day-to-Day Processes
12
Part 3: Closing Out the Accounting Period
16
Part 4: Reporting – Knowing About the Performance of Your Business (KPIs)
18
Chapter 14: Business Analytics with Business Snapshot and Short-Term Cash Flow
20
Part 5: For the Advisor

Where do we find our beginning balances?

As Xero is a full double-entry accounting system, it maintains both income statement and balance sheet accounts. Many small businesses have come to my firm only to track sales and expenses. That is OK if you are on the cash basis of accounting and your US federal business tax return does not require you to complete Schedule L (Balance Sheet).

Note

If the business has total receipts and total assets at the close of the tax year lower than $250,000, then you do not need to complete the Schedule L section of the form that includes a detailed summary of everything on the balance sheet.

Keep in mind that we recommend that you always complete Schedules L and M (1, 2, 3) if applicable.

You want to ensure the beginning balances you enter into Xero are correct to avoid issues over time as you perform your bookkeeping and reporting in Xero.

In most cases, the best-known balances come from your tax return. That means you will use the prior...