This documents the materials and classwork that was covered for basic bookkeeping that began in March and concluded at the beginning of May, 2012.
Through a combination of working through online tutorials, doing some excercises based on a fictitious potter's business, and subscribing to the free online accounting system at WaveAccounting.com, we learned together how to set up and maintain meaningful records of our businesses that are up to date, rather than finding out how we did at tax time. Balance sheets, profit and loss reports, accounts due and receivable do not come from the papers in a shoebox accounting system.
This was a peer-led group study effort.
The class can be repeated in the future if there is sufficient demand, and we expect to have more sophisticated tools for real time conferencing. An experienced instructor would be welcome to take over a future class.
Minimum number of students - 6
Maximum number of students - 12
Anticipated duration - 6 weeks
Anticipated start date - Undetermined
Required time commitment - 3-8 hours per week
Communications method - Private group discussion on the Cone6pots network and scheduled 90 minute Web conferences once a week.
Post comments and questions here.
Sign up by requesting to join this Group.
This is a fixed duration, class style study group covering basic accounting concepts and setting up our businesses on the online accounting system at WaveAccounting.com.
Participants are urged to check in and read all postings for this group at least 3 times per week.
There will be a $40 registration fee for the class. Those who complete the class with 70% or better participation will get a $20 refund or credit toward their next class.
Troy: I have read all lessons but I have not memorized very much.
George: Well, fearless leader only got through 1 1/2 lessons to my chagrin, but I think I have them under control.
Troy: Just when it starts to make sense the tutorial adds another layer of stuff and nocks me back down, but I am learning so it is good.
George: Anyone starting late is not going to see the preceding material
George: This chat is not up to snuff for us.
Ok, that brings us to now and we can start talking, without loosing anything
Wes, Troy, are you here?
Wes Stack I'm here.
12:10 PM
Beverly Beu Haas Hi George and Wes. Sorry to be late. I had sinus surgery this past week and was unable to get to homework. I hope it's okay to listen in, though.
June Kinsinger i am here
George: Wes and Troy say they read all, but did not retain too spectacularly
June Kinsinger i agree with others...the exercises were great but referring back and redoing helps grasp the tasks
George: I read less but have a fair handle
Wes Stack I would be anxious to put the concepts into action. Think I'll learn them better that way.
Troy Bungart I just need to find time to keep re reading it.
June Kinsinger i found taking each task and looking at it as a single entry helps the most having a sample printed out to refer back to helps keep things straight also
Troy Bungart I know a lot more now than before I started this.
June Kinsinger yes....and the more entries you make and repeating them helps understand the double entry process
George: The material will not make a whole lot of sense until we use it, but we can't really use it until we have accounts in hand.
12:16 PM
Wes Stack I haven't looked at Wave accounting, but would setting up our accounts using that software make us focus on the "how to"?
George: Let's do that right here. What would be our asset accounts? Please number them
Wes Stack Asset accounts for what business?
George: Our own or Joe Potter
1. Cash
Wes Stack
2. Equipment
June Kinsinger
2. pottery wheel
3. chemiclas
opps
Wes Stack
4.clay
George:
5 Checking Account
6. Paypal Account
Wes Stack I don't use Paypal. How is this account an asset. Do you make a deposit?
June Kinsinger it can hold cash payments on sales and can be used to pay payables
Wes Stack OK
Troy Bungart I use paypal, mine is an asset
George: When people buy my stuff on etsy the money collects there
Wes Stack
Learned something already!
George:
7. Accounts receivable
12:24 PM
June Kinsinger
liabilities? accounts payable
George: Not done with assets yet
June Kinsinger
ooops
George: Anyone?
Troy Bungart is stock an asset?
George: Is it part of the business or separate from the business?
Troy Bungart It is what is going to be sold hopfuly
George: Your Stock is inventory - I have an accountant's input on that.
12:28 PM
Troy Bungart Okay. right, if I counted materials and finished product the materials would be counted twice.
June Kinsinger inventory would be asset. i was thinking of stock in a company outside of your personal business
12:31 PM
George: He said leave everything as raw materials until it is going out the door as finished goods. Everything is tracked as cost of goods sold.
Troy Bungart okay
George: Finished pots on the shelf are nothing but clay and glaze.
12:33 PM
George: The remaining typical asset accounts would be office supplies, Furniture, buildings, land, vehicles
George: OK, we have a list of asset accounts. Some are actually items within accounts. Equipment is an account containing wheel, kiln, pug mill, etc.
Can someone condense and repost the asset accounts?
June Kinsinger i can
Wes Stack Would there be accounts for chemicals, clay, etc. or would they be under one account such as "materials"?
12:38 PM
George: Good observation - Raw materials would be a good account
June Kinsinger 1. checking acct 2. raw materials 3. equipment 4. paypal acct 5. accounts receivable
George: Do any of you in your businesses have any other assets that don't fit well under categories we have named?
12:42 PM
Troy Bungart I don't think so.
Wes Stack
No, but I've never accounted for furniture and land in my accounting. How do those work?
12:45 PM
George: They don't enter into your profit/loss picture, but they can be used in your balance sheet to show the value of your business in the event you need to get a loan to expand your business.
June Kinsinger our accountant uses a %age calculated by the size of my shop space to the actual size of our property
Wes Stack Thanks both. Good to know!
June Kinsinger that same percentage is used when calculating taxes as a %age of utilities and such.
12:48 PM
George: Potters generally find they can't make a successful business just making and selling pots. They often diversify by teaching classes and or offering studio space to other potters.
12:50 PM
George: Anything else about assets?
June Kinsinger does anyone know what a going rate would be for private lessons?
12:53 PM
Beverly Beu Haas still here
12:54 PM
George: A one on one private lesson should relate to your skill as a potter, as a teacher, the quality of the workspace - all highly variable.
June Kinsinger thanks. Are we continueing next week?
George: Absolutely - I think we could spend another half hour to finish accounts today.
Wes Stack let's do it
George: I will post the remaining chat session for anyone who has to leave.
Troy Bungart I am still here
George: OK what would be the liability accounts?
Wes Stack Accounts payable
June Kinsinger
insrance
utilities
website
Troy Bungart
show fees
rent
George: No, those are expenses
Troy Bungart loans
George: except accounts payable
Notes payable
Mortgages payable
Wes Stack Is mortgage a liability or expense?
George: Both?
1:02 PM
George: The unpaid balance is definitely a liability. Where would a mortgage payment (for business) be a debit and where a credit? Let's come back to that one.
Now we need to break down the Owners Equity sub classes.
First Revenues
Wes Stack goods sold
Troy Bungart amounts billed or sold for services or products
1:10 PM
OK and services sold - classes, firing space,
Any other Income from the operations of the business?
Troy Bungart you could sell some raw materials if you are buying in bulk
George: Rental income is a possibility. I know potters who do that
Wes Stack How about value of pieces donated to charities?
George: No revenue out of that.
1:14 PM
Troy Bungart what about intellectual property, say I sell a book or dvd
publish a book or dvd
1:15 PM
George: That would be revenue
I have an unexpected guest I must visit with, so must cut this short. Can you all complete a list of accounts? June and I will combine them into one we will use for Joes Pottery and then provide you with a list of transactions to correctly account for. I will post this by Wednesday evening.
Accounting 101 for Ceramic Artists
14 members
Description
This documents the materials and classwork that was covered for basic bookkeeping that began in March and concluded at the beginning of May, 2012.
Through a combination of working through online tutorials, doing some excercises based on a fictitious potter's business, and subscribing to the free online accounting system at WaveAccounting.com, we learned together how to set up and maintain meaningful records of our businesses that are up to date, rather than finding out how we did at tax time. Balance sheets, profit and loss reports, accounts due and receivable do not come from the papers in a shoebox accounting system.
This was a peer-led group study effort.
The class can be repeated in the future if there is sufficient demand, and we expect to have more sophisticated tools for real time conferencing. An experienced instructor would be welcome to take over a future class.
Minimum number of students - 6
Maximum number of students - 12
Anticipated duration - 6 weeks
Anticipated start date - Undetermined
Required time commitment - 3-8 hours per week
Communications method - Private group discussion on the Cone6pots network and scheduled 90 minute Web conferences once a week.
Post comments and questions here.
Sign up by requesting to join this Group.
This is a fixed duration, class style study group covering basic accounting concepts and setting up our businesses on the online accounting system at WaveAccounting.com.
Participants are urged to check in and read all postings for this group at least 3 times per week.
There will be a $40 registration fee for the class. Those who complete the class with 70% or better participation will get a $20 refund or credit toward their next class.
Week 2 Chat session Transcript 3/25/2012 -- (Too long to post as a reply to Week 2 discussion)
by George Lewter
Mar 25, 2012
Wes Stack I'm here.
12:10 PM
Beverly Beu Haas Hi George and Wes. Sorry to be late. I had sinus surgery this past week and was unable to get to homework. I hope it's okay to listen in, though.
June Kinsinger i am here
George: Wes and Troy say they read all, but did not retain too spectacularly
June Kinsinger i agree with others...the exercises were great but referring back and redoing helps grasp the tasks
George: I read less but have a fair handle
Wes Stack I would be anxious to put the concepts into action. Think I'll learn them better that way.
Troy Bungart I just need to find time to keep re reading it.
June Kinsinger i found taking each task and looking at it as a single entry helps the most having a sample printed out to refer back to helps keep things straight also
Troy Bungart I know a lot more now than before I started this.
June Kinsinger yes....and the more entries you make and repeating them helps understand the double entry process
12:16 PM
Wes Stack I haven't looked at Wave accounting, but would setting up our accounts using that software make us focus on the "how to"?
Wes Stack Asset accounts for what business?
Wes Stack
June Kinsinger
Wes Stack
George:
Wes Stack I don't use Paypal. How is this account an asset. Do you make a deposit?
Wes Stack OK
Troy Bungart I use paypal, mine is an asset
Wes Stack
12:24 PM
June Kinsinger
June Kinsinger
George: Anyone?
Troy Bungart is stock an asset?
Troy Bungart It is what is going to be sold hopfuly
12:28 PM
Troy Bungart Okay. right, if I counted materials and finished product the materials would be counted twice.
June Kinsinger inventory would be asset. i was thinking of stock in a company outside of your personal business
12:31 PM
Troy Bungart okay
12:33 PM
June Kinsinger i can
Wes Stack Would there be accounts for chemicals, clay, etc. or would they be under one account such as "materials"?
12:38 PM
June Kinsinger 1. checking acct 2. raw materials 3. equipment 4. paypal acct
5. accounts receivable
Troy Bungart
12:42 PM
Troy Bungart I don't think so.
Wes Stack
12:45 PM
June Kinsinger our accountant uses a %age calculated by the size of my shop space to the actual size of our property
Wes Stack Thanks both. Good to know!
June Kinsinger that same percentage is used when calculating taxes as a %age of utilities and such.
12:48 PM
12:50 PM
June Kinsinger does anyone know what a going rate would be for private lessons?
12:53 PM
Beverly Beu Haas still here
12:54 PM
June Kinsinger thanks. Are we continueing next week?
Wes Stack let's do it
Troy Bungart I am still here
Wes Stack Accounts payable
June Kinsinger
Troy Bungart
Troy Bungart loans
Wes Stack Is mortgage a liability or expense?
1:02 PM
Wes Stack goods sold
Troy Bungart amounts billed or sold for services or products
1:10 PM
Troy Bungart you could sell some raw materials if you are buying in bulk
Wes Stack How about value of pieces donated to charities?
1:14 PM
Troy Bungart what about intellectual property, say I sell a book or dvd
1:15 PM
George: That would be revenue
Troy Bungart Thanks George!
Wes Stack Will do. Thanks much.