Seperating Business Accounting for divisions


Y

yayoubetcha

I have an internet web development and services business (develop web
sites). This is an LLC business. I want to start a division of my
business which books adventure travel tours. Do I need to seperate the
accounting for the two "divisions"?

Thanks in advance for all usesful replies!
 
Ad

Advertisements

S

S.M.Serba

Ask your accountant.

--
Stephanie Wells, AICIA
Partner, Durham Business Outsource
Accounting & Technology
www.dbo.ca
smwells <at> dbo <dot> ca
 
B

~^ beancounter ~^

you dont "need" to, but i would think you would want to...you may (in
the future) want to know what each line of business was "doing"..ie:
revenue and/or expenses...
 
D

David Jensen

I have an internet web development and services business (develop web
sites). This is an LLC business. I want to start a division of my
business which books adventure travel tours. Do I need to seperate the
accounting for the two "divisions"?
Only if you want to understand whether the two divisions are both worth
your effort. Some publicly traded companies are required to break out
their businesses if they multiple lines of business, but privately owned
businesses are not. Depending on the state, it might be a big advantage
for you to split them if you have to collect sales tax for the travel
tours, but don't for the services.
 
A

Arnold

Ken,

If you are keeping both businesses under the same LLC, then all you need
to do is "departmentalize" your chart of accounts. Each department will
generate its own income statement. If you use the right accounting
software, it will also generate a "consolidated" income statement,
showing the combination of both businesses. Because cash and other
assets will probably be mingled, that should handle it. If you don't
know how to departmentalize your chart of accounts, it is available in
the Preferred Edition of A-Systems Visual Bookkeeper at
http://www.a-systems.net/vb.htm for an affordable price.

Now, here are the questions. Do you think it's appropriate to have both
companies share the liability of the other company? If you recognize
the wisdom of having an LLC to limit your personal liability, why not
limit the liability of each company to its own operation? That means
having two LLCs. It I were doing it, that's what I'd do. Then, you can
use Visual Bookkeeper to run both companies, separately.

Just my thoughts,

Arnold
 
Ad

Advertisements

B

Bill Lentz

I have an internet web development and services business (develop web
sites). This is an LLC business. I want to start a division of my
business which books adventure travel tours. Do I need to seperate the
accounting for the two "divisions"?

Thanks in advance for all usesful replies!

You may want to check in misc.taxes.moderated (if you are in the US).
You may need separate schedule C's if that's the way you file.
 

Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Top