Any trucking company has financial documents and basic accounting points. You can be engaged in such a business for a long time, or your firm is just beginning to develop. Accounting for trucking business allows you to control the financial situation to understand the overall level of service efficiency.
Basic Accounting Definitions
You need to know the following terms to keep track of the general picture and promptly make adjustments to the accounting system:
- Assets. This is something valuable that your company owns (cash, real estate, vehicles, etc.)
- Liabilities. What your trucking firm has to do (salaries, loans, debts, and taxes).
- Equity. This is the amount you get when you deduct the liability from the assets of the company.
- Revenue and Gains. This is the arrival of money that replenishes your capital. The sale of equipment or real estate is also taken into account.
- Expenses. The costs that your business uses to provide its services.
- Losses. You receive a certain amount for a service, but this sum is less than you spent.
Financial Statements
To control and analyze all the data, use the appropriate accounting software. Your trucking factoring service will have 3 main documents for obtaining a general financial analysis.
Balance Sheet
An overall picture of your financial condition that you can get at any time. This is the ratio between assets, equity, and liabilities. Pay attention to the balance sheet regularly to avoid challenging financial situations.
Income Statement
It is a comparison of the sales of your trucking company’s services with the total costs. You take a report for a specific period (year, quarter, month) to see data on losses and income. If you have no financial holes, you will stay pleased with the income statement you have.
Cash Flow Statement
Here, you see how much money your trucking business earns and can get a forecast for future cash flow. The profit and loss statement gives the information that has passed. Here you understand if your service is successful and how the money is generated.
You can do the accounting yourself or hire a qualified employee. Watch the reports to keep your trucking business stable and successful.