Beginner's Guide to Accounting for Machinists & Entrepreneurs

Accounting for Machinists and Manufacturing Entrepreneurs: Beginner's Guide. When starting a business, a basic understanding of accounting and how it applies to you is crucial! We'll discuss something that kills 82% of small businesses: Cash Flow problems. Knowledge is power, so let's dive in.

[Factory]

Excellent
My solution was that I married an accountant (CPA that specializes in taxes). While that was not the reason I married her - my business has hugely benefitted from the knowledge of accounting she has offered.

If you do not understand accounting, you really don't have a business - you have a hobby that you charge money for.

[tacitus]

You explained that all extremely well! Very much looking forward to the rest of the series.

[ShopNation]

Really good video John! Keep this kind of stuff coming

[jesusr]

John keep making these types of videos! It’s a really great perspective of machining and business that is often overlooked, and you make it really interesting!

[MR.KNOWITALL]

This World needs more people like you John:) Your an amazing individual!! (to say the least) Watching your Arduino vids from way back got me hooked into machining! Like you, I didn't know anything about machining & now I have a CNC machine/surface grinder/lathe and I can run them mostly because of you... I just wanted to SHOUT out thanks man!! look forward to the rest of this series!

[TheWidgetWorks]

This is one of the best videos you've done! Please more! Everyone needs to watch and learn this, taxes are very simple and at the same time very complex. Most people don't understand why there company did or didn't by a machine or move into a better space and 90% of it is down to cash flow and projections.
Next video 'How to decide what is the right capital investment and when to make it!' Everyone would love a 5 axis done in one machine but is it the right financial decision? Probably more often than not no but sometimes yes...

[jmosufsen]

Thank you very much for the video, John. The portion on recapturing depreciation upon sale of equipment was especially helpful. I really hope you do an additional video on cash flow!

[EZ_shop]

It was about time someone broached the subject. Excellent explanations with clear examples. Loved it! Thanks John.

[zyndapp]

Well, as a shop owner I would like to point out one thing about depreciation - on one hand it may look good to "value down" your 100k new machine asap, but that creates another problem. When you want to buy a new machine. You don't buy it usually for cash, right? One would most commonly buy it with leasing. Now they want to see as mutch profit aka "net income" as possible. Otherwise they will tell you that you don't earn that mutch money to pay for it. So I usually set the time of depreciation to a reasonable level (5-7 years when buying a new Haas) to buy 1-2 new machines every year.

[travers]

This is an awesome video, thanks for also including this in your scope of discussion, we're all passionate about machines and production, but it doesn't work without the business aspect. Blew my mind that so many businesses fail due to cash flow specifically.

[JayTrussell]

Thanks for the video. I work in IT and have been banging my head against the wall with trying to write reports for the finance folks. This video (like many you do) cleared up a lot of things that did not make sense (like depreciation and capitalization). Thanks!

[TAWPTool]

Excellent video John! Very nicely explained.

[whiskeythrottle]

I´m not going to be a machinist, and i´m not living in the US. But this was still really informative and i´ll be looking forward to this series.

[bailey]

I'm looking forward to more accounting videos like this. Super valuable!

[qcnck]

Thanks, John, for a clear and succinct video.

[jianhuiluo]

Very nice video for accounting! Thank you!

[exactengineeringllc]

John,
Great explanation and extremely important topic. The section 179 can really be beneficial if used with care! How about how to calculate overhead, burden rates etc.

Best,

Dave

[xlxlxl]

Thank you. Great explanation of an important topic. Waiting to learn more.

[teekianhan]

Great seminar on accounting. note on cash/accrual accounting method does not apply to delivered sales best sample would be in process services or undelivered goods or service.

[FesixGermany]

Do you also see the dots in the calendar at 3:00? ;-)