All business owners need to monitor a number of different financial figures when it comes to managing their business. These figures can be prepared by a Bookkeepers Hereford way who can also support businesses with the day to day business finances. Here are some of the most important figures for business owners to be aware of.
- Revenue – this is the total amount of money that the business generates from its overall sales. It is important that business owners monitor their revenue to ensure that they are generating enough income to cover all the expenses that the business has, as well as leaving some money behind to make a profit.
- Expenses – these are made up of the regular bills and payments that are made to allow the business to carry out its core functions as well as ad hoc expenses that may be accrued in the process of running the business. It is important that these are monitored so as to ensure that the expenses are not too high for the business to sustain.
- Profit or Loss – this is the amount of money that is left in the business once all the sales have been accounted for and the expenses have been made. Where money is left in surplus this is profit and where expenses are too high when compared to the income level this can lead to a loss.