In order to have a positive experience with an introductory class, it's imperative for you to understand what you will and won't get from the class and the ZAP Accounting Software Bookkeeping Module.

Many of you might prefer to get this information below in a video format. That will come eventually. We are looking for those who can read and absorb the information for our first few rounds of classes.

The information below is intended to clarify things for you without
diving deep into any of the content.

Read this. Digest it.

Read it again if necessary.

Then decide if the introductory class with an immersive,
hands-on-training session is for you.

It's impossible to understand what you don't know without spending time in unfamiliar territory.

Soon enough this will all make perfect sense for those that can apply themselves.

Soon enough you'll be able to craft your own, very relevant questions.

Until then, please allow us to tell you what questions you need to ask first, and then just follow our lead!!

The ZAP Accounting Software Bookkeeping Module is designed very specifically to assist with your "Tax and Financial Accounting" needs only.

This process is designed to generate an Income Statement and a Balance Sheet first and foremost.

There are in fact some options in the Bookkeeping Template that blurr into your Managerial and Cost Accounting needs, but that blurr is far less than what many might expect if you've used other software or if you have a pre-conceived notion that you always want a single software package for all required functionality.

• ZAP offers other templates for your Managerial and Cost Accounting needs such as Invoicing, Point of Sale, Accounts Receivable, etc. The ZAP Bookkeeping template is used in parallel with those systems or similar provided by other vendors.
  

• We do NOT advocate connecting any other ZAP modules to your primary bookkeeping module and we do not advocate connecting any outside software to your Bookkeeping Module. Such a connection is NOT required and for the simplest and most efficient Bookkeeping experience it is highly discouraged.
  

• If you are currently thinking you want a single module to do everything, you are thinking incorrectly about a topic that you don't have a full understanding about from a systemic perspective.
  

• For those hung up on this thought, it may take a surprising amount of time for you to let it go.
  

• Unfortunately, you won't fully understand it until you actually start working with ZAP Accounting Software, some data, and a good Coach, but once it clicks it will be an ah-ha moment.

For many people it's impossible to "understand" this data separation concept and the benefits it provides you work with it a bit, at which point things become very clear quickly..

We'll close out this intro to the "Tax/Financial Accounting vs Managerial/Cost Accounting" Section with a little bit more information below, but this is about all we'll provide on this until after you've taken the time to put your hands on the keyboard.

"Tax Accounting" and/or "Financial Accounting is a very specific subset of Accounting with an extremely well defined scope.

The most relevant initial reports derived from Bookkeeping for your Tax / Financial Accounting are 1) An Income Statement and 2) a Balance Sheet.

1. The Income Statement is a summary of categorized transactions that provides insight into your income flow and your expense items for a given period of time.

2. The Balance Sheet is three reports in one. All together it represents a mathematical tool which provides a "company net worth" value for a given date AND it provides a very unique mathematical cross checking section which helps ensure no egregious mistakes were made in categorizing your transactions for reporting purposes.

To the surprise of many, in order to create a "proper" Income Statement and a "proper" Balance Sheet no specific information needs to be known about individual customers or jobs or details related to income.

"Managerial Accounting" and/or "Cost Accounting" requires more detailed information related to customers/clients/patients and the jobs, products or procedures they may have purchased as well as expense details related to those and your overhead that may have been summarized in your Tax/Financial Accounting records.

If you are using Quickbooks, FreshBooks or any other software and if you have created a customer list or if you are doing invoicing, you are in fact using software that is designed to do both your Tax/Financial Accounting AND your Managerial/Cost Accounting at the same time.

While this sounds like it is attractive, in fact, it's not. In fact, it over complicates your accounting process and it often times binds you to software solutions and business processes that are unhealthy and/or not in your own best interest.

if you ask us to provide more clarity on this data separation concept prior to putting your hands on the keyboard and working with data, we will decline to provide further information as it's something you need to gain an understanding about via personal experience.

There is a lot more written information available at the ZAP Accounting Software website that can fill in a lot of blanks but we would discourage digging into that more until you've gotten some experience with the software first.

Be comfortable learning how to use the technology before you fully understand the business flow.

The Box of Pencils Example

If I asked you to total your purchases of pencils using the signed data you entered without any thought, we'd have NEGATIVE 2 plus POSITIVE 2 and the sum would be ZERO not FOUR, as desired. In order to get 4, we would have to change the sign on the Checking Account transaction for reporting purposes.

As long as we have software creating our reporting that knows that rule, we can use positive and negative values.

Without software, it was far more important to make it easier to use positive numbers at all times to facilitate long addition but you needed a way to separate one set of positive numbers from another set that would represented decreases, and that's the conundrum that Debits and Credits solved.

Debits and Credits is a mathematical system where only absolute values (positive values) are used for all data recording, and all data recording happens in either a Debit or Credit Column in a two column journal instead of a single column journal as required with positive and negative values.

Since the advent of computers, where the bookkeeper no longer had to do long addition, it was NOT necessary to ask the users to use Debits and Credits.

Unfortunately, nobody ever slowed down enough to think about how much easier it would be to teach accounting and how much easier it would be to do work in software without them.

As it turns out, it makes everything far easier for both basic and advanced education. It also makes everything easier in practice for small to mid-size businesses if not all businesses too.

Sometimes questioning the design of the wheel really does produce a better wheel.

Bookkeeping and Accounting should be thought of as "score keeping" for the game of commerce.

A Category List is most often made up of a list of items that you want to use to categorize money that left your business (money spent on expenses). That's it.

• Unknown to you, the formal term for category in Bookkeeping is an "account". In the case of the pencil purchase above, that might get categorized as an "office expense" and when referring to that category we might say "what is the balance for the "office expense account".

• These types of lists are found in simple bookkeeping solutions where they don't want to trouble you with vocabulary.

A "Chart of Accounts" contains "expense categories", but it in total it contains five types of categories often remembered with the acronym ALEIE

• Assets, Liabilities, Equity, Income and Expense

To over simplify things, in order to create a Balance Sheet, we need this expanded List of Accounts (Chart of Accounts) as opposed to just expense categories.

When we do Tax Accounting for a Small Business, the end goal is providing categorized Transactions for an IRS form called the "Schedule C", and conveniently enough, that form has a list of about 4 income accounts and 25 or so expense accounts so we don't have to be creative with the names in our Chart of Accounts for income and expense accounts. If we just use what is required by the IRS our life remains amazingly simple. If that is not enough for our own wants, we can do things outside of that to meet our needs while keeping our books simple and easy for tax purposes.

If you are in Small Business and if you want to claim you are in fact using Double Entry Accounting, you must generate a Balance Sheet.

Accounting without a Balance Sheet can not be deemed double entry accounting and Accounting with a Balance Sheet where a dump account is used for errors also should not be deemed double entry accounting, even though 90% of Quickbooks users likely use a dump account because they can't find their errors easily in that system.

We have created a Balance Sheet that is different and down right "cool" with a go/no go light and the ability to drill down and find errors that does not exist as easily in any other digital system. Hopefully you'll come to really appreciate this with time.

In order to create a Balance Sheet, you really need to use "dedicated accounts" for your Checking and Credit Cards. By dedicated, we mean all the transactions in the accounts need to be business related. We can handle a few that are not, and in fact we can teach you how to handle a lot that are not, because we have ways to show those on the Balance Sheet that others never dreamed to do, but in general, having dedicated accounts for your Business transactions makes this all a lot easier.

If you've gotten this far and you like the way this information is presented you will likely enjoy a few hours with your hands on the keyboard while following the instructions of someone who wants to see you succeed with your own bookkeeping and accounting.

If done properly, you will find the experience to be surprisingly effortless.

When we start the class we will spend 20 to 30 minutes getting to know each other. Then we will spend 15 to 20 minutes max covering any questions you may have about this introductory information that was just presented, but that's it. If we spend any more time trying to talk about this before you dive into to doing the work yourself, the time spent will be wasted unnecessarily.

There is a LOT of written information and videos on the ZAP Accounting Software website. If you'd like to try to read ahead, or view ahead, feel free to do so, but for most, it's best to simply put your hands on the keyboard and allow a coach to guide you through the technology experience for your introductory education.

Once you have a working understanding of the software, everything will make more sense and then you can use the ZAP Accounting Software Website, computer lab time and/or more classes to dig further into this trade.

If you like the way this read, please sign up for the introductory course.