Most Common Misunderstandings about your Financials

Financial Snickens

Are you a business owner struggling to make sense of your finances? Do tax time and loan repayments leave you feeling confused? Fear not, as we have got you covered in this podcast episode! Join us as we unravel the top five questions that entrepreneurs commonly have around financial misunderstandings and provide you with actionable tips to navigate them. From demystifying loan repayments and owners' draw to understanding how to record funds properly, we've got everything you need to know to make informed decisions about your finances. Alisa will guide you through managing cash flow, tracking expenses, and comprehending profit margins. Don't miss out on this opportunity to take charge of your finances and make informed decisions for the growth of your business!

Key Highlights:

[00:00 - 02:28] Uncovering the Most Common Misunderstandings About Your Financials

• Tax time is a stressful time for everyone
• When repaying, money is given back to the bank and interest is an expense
• Interest is recorded as an expense on profit and loss statement

[02:29 - 07:23] Understanding Owner's Draw: Why It Isn't an Expense to Your Business

• Bank balance decreases when you pay a loan, but it doesn't increase your expenses
• It is critical, as the owner, to understand your entity type so that you can comprehend how you can take money out of the firm

Key Quotes:

“Your bank balance decreases when you pay the loan….but it doesn't increase your expenses.” - Alisa McCabe

“It's really important to know what type of entity you are so you can record and understand how you as the owner can take money out of the business.” - Alisa McCabe

Learn more by connecting with me through LinkedIn, Instagram, and Facebook. Head to our website and click on the Let’s Talk button http://www.firststepsfinancial.com

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