New FFL Accounting

[hakuna]

Sorry to ask such basic stuff, but I'm a gun guy FFL and not a businessman becoming an FFL. Which means, of course, I'm reasonably clueless as to accounting (though I'm computer savvy). I've set up an excel single entry system for my accounting. I'm essentially a kitchen-table FFL (though I have more than that going on, I don't have glass cases with a stock of guns for sale) and I'm doing DROS transfers. Often I buy a gun specifically for a customer and then the customer buys it from me. So I'll order a gun and put the gun purchase in my expense column(s)....when I sell the gun I put the gun cost in the income column(s). I have separated out gun, DROS, Sales tax, profit, etc for tax purposes.

My question comes up because I was reading about having to choose between accrual and cash methods of accounting. I was planning on keeping everything simple and declaring cash as the method since I don't have any open accounts with anyone. I also don't really want to learn and use Quickbooks, since my excel workbooks seems to be all I need...but I may be deluding myself on all this.

So, my question is: Cash or Accrual? Also, Recommendations from you guys? Would it be wiser to just buy Quickbooks and bite the bullet and learn it? I've only been in full operation for a month so I can still switch if that is the smarter course of action.

Thanks much in advance,
Gary

[acespawnshop]

We are a larger corp and do more than just guns, but that being said I would check with your CPA or accountant and see what type of reports they will want to see when they file your quarterlys, and return. Also I would say learn quickbooks just because it will make your life easier in the long run. Do you plan on doing all that stuff on your own since you are a "kitchen table" FFL? I personally wouldnt want to make bonehead mistakes because I dont understand all the tax laws, thats why I defer everything to my CPA.

Good luck with everything and your new business. Also quickbooks interfaces easily with intuit and you can use them if you chose to accept credit cards as payments. Might be a good business choice to accept cards and not just cash so you don't limit what your customers can pay with. ( I know some people just aren't comfortable carrying a lot of cash)

As far as accounting goes I would go with the simpler Cash method over an accrual method. It sounds like you probably will be best to keep it simple since you probably wont be doing much volume from home. I dont think you will be rendering much services without being paid up front either, right? So the "cash" method would make more sense to you. But you should ask your CPA.

Good luck in your adventures with firearms!

[hakuna]

Thanks for the reply. I appreciate you taking the time! I guess I should have realized that most of the FFLs here are big enough to use an accountant and tax preparer. I'm in the "boonies" and small enough that I'll do it all myself. I was hoping to hear from other "do-it-all-yourself" types, but maybe that's the answer....most everyone is using professional help.

I just found I do have a customer that is a CPA, and his gun is in my "jail", so maybe before I release the gun to him, he'll have to undergo some questioning, LOL.

If any of you other FFLs are "little guys" please give me a hint on what you do or are using for accounting purposes.

Thanks,
Gary

[acespawnshop]

There are a few guys on here that I know have mentioned they are a small outfit. Sounds like a good starting point with your customer who is a CPA. Im sure that they would like to point you in the right direction. You help him with his gun he helps you understand some tax law! People helping people. Love it!

I have used quickbooks for other businesses that aren't firearm retailers and are small 1 man stores, and it works well. Real easy to learn and I know that you can also keep a customer database in there too so if later you wanted to do some target advertising to people you have already done business with it would be easy. Plus it helps to have the reports quickbooks generates like a balance sheet and P&L.

[hakuna]

Thanks. I bit the bullet and I'm learning Quickbooks. I also have been reading a tax book and an accounting book. Any of you guys reading in this forum thinking how cool it would be to be an FFL better think again. It IS cool, but a HUGE percentage of being an FFL is NOT about guns! LOL.

Gary

[acespawnshop]

Any of you guys reading in this forum thinking how cool it would be to be an FFL better think again. It IS cool, but a HUGE percentage of being an FFL is NOT about guns! LOL.

Gary

That's typical of any business. The devil is in the details....

[tenpercentfirearms]

If it wasn't for suppressors, I would be done with it.

[ugimports]

Thanks for the reply. I appreciate you taking the time! I guess I should have realized that most of the FFLs here are big enough to use an accountant and tax preparer. I'm in the "boonies" and small enough that I'll do it all myself. I was hoping to hear from other "do-it-all-yourself" types, but maybe that's the answer....most everyone is using professional help.

I just found I do have a customer that is a CPA, and his gun is in my "jail", so maybe before I release the gun to him, he'll have to undergo some questioning, LOL.

If any of you other FFLs are "little guys" please give me a hint on what you do or are using for accounting purposes.

Thanks,
Gary

I am a small shop. Just me and my wife. We use quickbooks. I have an accountant, but she just closes my books at the end of the year. I had her looking at it quarterly, but once she helped me set it up I was good so only have her close it out at the end of year and do the taxes. She also does my personal taxes so I have her do the small business as well since they are related with my LLC. I probably pay $1000 year for the personal + business taxes + closing out of my books that would be "auditable".

[hakuna]

I'm working on learning Quickbooks and converting my old accounting system (Excel sheet) to it. So far so good. I'm in the middle of trying to figure out how to set up this and that, but Quickbooks came with 90 days free phone support, so that is worth the price of the software! I'm just too small an operation to hire a CPA, so like most things I do, I just have to learn how myself. We'll see how I do, LOL.

Gary

[freonr22]

As far as small business goes, regardless of the specific details of being angel, quick books pro is worth the money, and if you have any employees paying intuit with 941's is huge for the money