Best Small Business Accounting Software

Cody Cromwell
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Top 9 Small Business Accounting Software Options

Knowledge is power! Creativity is great, and problem solving is a must, but there’s no shortage of ways to succeed in business these days. Unfortunately, not having the right tools to back you up can cost you in the long run. Thankfully, there are plenty of small business accounting software options available for you to choose from.

If you haven’t had a moment to do an audit lately, it’s time to put aside some time to go over your financials. Maybe you need to run a successful business to survive, or maybe you love doing research, but at the end of the day, more knowledge will help you know how to make your business run better.

Whether you’re starting out or you need to be more efficient with your current accounting practices, the right software can make the difference. For your peace of mind, there are clear-cut advantages and disadvantages to each of the top business accounting software options.

Taking into account your wants and needs will help you decide which route you want to take. Are you ready? Here’s a quick comparison guide to help you decide which software you should go with.

If you are looking for the best small business accounting software, then read on. There are several different software options to choose from and a few different ways you can implement them to control your business expenses. Take this into consideration when choosing your small business software.

Internal Accounting Software

Internal accounting software is an affordable way to track your business’s daily transactions on a computer. This type of software tracks your small business gross profit, expenses, and daily financial data, all from your computer.

Another benefit of internal accounting software is that it allows you to build and track your business’s financial data from any location. So if you are travelling around to different sales conferences, you can connect your computer to the internet to view your internal accounting software.

To analyze your data, you can create financial reports and even generate the financial statements. So with this software, you can have peace of mind on the road, avoid missing a transaction and stay on top of your financial status.

There are other benefits to using internal accounting software as well. For instance, you can customize the software to fit your small business’s specific needs. With this software, you can easily track your daily companies operations, manage day-to-day tasks, build and manage your business budget and keep track of the daily accounting of your company.

Question 1

How Would You Like To Work?

As a sole proprietor, an LLC member, or an S-Corp owner, you’re responsible for keeping your books and records. And as you no doubt know, it’s easier said than done. An accountant or bookkeeper is the ideal solution, but depending on your business, these professionals can be expensive. The best option is to do it yourself – but not without planning.

To get started, you’ll need to name a purpose for your books and records. The purpose should guide the type of transactions you’ll record. For example, if you’re a consultant, you’ll want to add receipts and invoices, while a gym or a fitness studio relies on memberships and payments, etc.

You may also want to add your financial statements to your books. Whether you use a standard business form or create a custom form is up to you; however, you’ll need to name your company’s fiscal year and its annual income or loss.

Once you’ve decided on your purpose and a financial element, it’s time to plan your books with the help of a spreadsheet. Here’s how to get started.

Which best describes your business?

In California, the number of businesses was up 2.8% in summer 2010, while the number of businesses in the Northeast increased by 0.8%. The worst growth was in the Midwest, where businesses declined by about 2.1%. California, Colorado, Florida, and Texas were the top states for growth, with 17%, 6.9%, 6.2%, and 5.9%, respectively.

The U.S. Census Bureau releases new statistics on business establishments every quarter. The data are broken down by place of business, industry, size of establishment and more. While the data cover the entire nation, they don’t give a lot of insight into what’s happening in specific regions.

If you’re wondering whether your region is seeing any growth or declines in operations, these reports can help you track trends.

Question 2

Question 1 having cleared your way for choosing an accounting software you have to be worrying about which best suits your needs. No matter what data entry industry you are into where you need to handle your invoicing and accounting, the first thing you need to make sure that you have a system that supports the software you are using. If you need to use Windows accounting software, selecting an accounting software designed for Windows will be sufficient.

In order to select the right software for your business, you need to be well aware of what your industry demands. The first thing that you need to think about is your industry itself. This will in turn be used as a basis for your software type.

If you are a caterer, the best accounting software is the one that has built-in inventory management and inventory stock reports. For a firm dealing with retail and wholesale transactions, you need to make sure that the software you have is Transaction-based Accounting software.

If you are in the manufacturing industry, you need to make sure that the software you select for your business has the proper inventory management option.

If you are involved in the purchasing of materials, inventory records will come handy. This software would allow you to track your purchases over a month or a year and purchase materials on time.

What is your budget for accounting software?

How important is accounting software while choosing a small business accounting software? A good accounting software can help your small business to run smoothly and efficiently manage its finances. It can also make it easier for you to maximize your time and work on other parts of your business.

Business owners that already have a small business, but are unsure about accounting software and its various features may want to understand the different points to be considered before buying one.

While deciding money to be allotted to small business accounting software is not an easy decision, here are two basic ways you can approach it when deciding on the budget.

Figure out Your Actual Needs and Budget

Before figuring out the maximum amount you can afford, you have to figure out the actual needs. What are the minimum features that you may need to keep a good control over the activities and finances?

The basic accounting software will have at least point out the tracks for you to keep a good auditing on the overall finances and the income and the expenses under each sale. Thus, you may be able to manage the finances without the costs of extra accounting software.

You also need to check all the features that a small business accounting software offers. Accounting software has different types of functions that can be added depending on the overall business needs.

Question 3

What are the differences between QuickBooks, QuickBooks Pro and QuickBooks Premier Accounting Software?

The main difference between QuickBooks, QuickBooks Pro, and QuickBooks Premier is the levels of the software. QuickBooks is the most basic level of the software and Pro and Premier are the highest levels.

QuickBooks provides you with all the basic features and functionalities of accounting. It is easy to use and does not require the memory space.

QuickBooks also works on a single user basis and you need not rely on the help of multiple users. QuickBooks also provides you with multiple tabs and windows for a single user, which makes working with it better.

QuickBooks also provides multiple reporting tools to make it easier for you to understand your business and see where there is a scope for improvement.

The leader in the QBA range is QuickBooks Premier, with the most powerful features and functionalities. These features are too technical for many small business owners to really use, but are needed for larger businesses that might need to be audited. It can be confusing for first-time users to get their head around the idea of a Premier Version of QuickBooks. It is the choice for those of you who need help with their accounts and need the most pre-emptive protection against fraud and theft.

How many users do you need for your accounting software?

Here is a video on how we did the math for how many users to have.

QuickBooks Online: Best Overall Small Business Accounting Software

QuickBooks Online is the best small business accounting software because it’s a cloud-based alternative to working with standard desktop software.

QuickBooks offers features suited for small businesses, like invoicing and managing expenses. They’ve included a wide variety of pre-built templates for invoices, subcontractors, G/L accounts, purchase orders and more.

Cost-wise, the service is affordable and best of all, its online.

QuickBooks also offers a free version that’s intended for micro-businesses with up to 2 employees.

QuickBooks is also a simple solution to keeping tabs on your business and keeping your customers happy. You can access your company information on their website or download a mobile app to access your data any time you have to.

Our Expert Opinion

Sage Accounting: Best for Microbusinesses That Need Financial Statements

Sage 200 is the best Business Accounting software and one of the easiest to use. It is made especially for start-ups, sole proprietors, or micro-businesses.

The system is used by small businesses worldwide, and built to be a powerful and flexible Enterprise solution that can be tailored to fit your specific needs. Sage 200 is packed full of features, and is considered the fastest and most convenient system out there. This program includes QuickBooks integration, which is a convenient solution for users that need to connect with the world’s most popular accounting program.

It’s an affordable accounting package for small business, and it’s been around since 1992. This doesn’t mean that the software isn’t the best in the industry, but it does mean that it’s been around a while. The reason why I recommend Sage 200 over the other accounting software is because of its adaptability and flexibility.

Sage 200 has an answer for most of your business needs, including an HR package, company financial statements, accounting software, payroll, and a powerful invoicing system. It’s a great system for the start-up and makes it easier to complete projects and get the best financial reports on how your business is performing.

Our Expert Opinion

FreshBooks: Best for Professional-looking Invoices

Freshbooks is an online invoicing and accounting program that is ideal for professionals with the ability to customize job reports. Freshbooks can help you easily increase sales, track hours spent working on a report or invoice and manage your clients. The Freshbooks dashboard contains all of the tools you need to grow your business all without ever having to leave the program.

Secondly, Freshbooks tracks time and cost. It calculates how much time you spend on a job, which automatically tracks the billable hours for your client. This means you can easily set the amount a client will pay you per hour.

The Freshbooks web invoicing program also allows you to easily send invoices via email, thereby increasing your chances of receiving payment. After you submit your client’s invoice, they are immediately greeted with a not to invoice report. This report contains name, addresses, job data and job details, as well as the estimated hours spent to complete the job.

Freshbooks also has online or even offline time tracking. This means you can easily track the hours you spend on projects or invoices from anywhere.

Finally, using Freshbooks allows you to share jobs with your clients. This would allow your clients to easily select the jobs they want you to perform.

Our Expert Opinion

QuickBooks Self-Employed: Best Accounting Software for Freelancers

QuickBooks Self-Employed is a full featured and a great accounting software for small business and freelancers. It packs a lot of functionalities like invoicing, payment processing, email integration, reporting and other powerful tools available today. With QuickBooks Self-Employed, you have everything needed to start and run a small business.

When choosing the Right Accounting Software for your small business, you must ensure it has all the tools you need to simplify the accounting process. QuickBooks Self-Employed has everything like invoicing, payment processing, email integration, reporting, etc. to manage your business. You can create an accurate Profit & Loss Report of your business, track your financial transactions and generate a variety of other reports with ease which take the burden of accounting from you. Its advanced reports keep your business transparent and reliable.

QuickBooks Self-Employed mobile app compliments the desktop version of the accounting software with the on mobile devices. You can do your accounting from anywhere.

QuickBooks Self-Employed is extremely flexible and can adapt to any type of business model, making it ideal for freelancers, contractors, consultants, and small scale business. In fact, this accounting software is specially designed for small business such as a consulting company or a small creative agency. You can create new accounts in no time and invite clients from your phone or PC.

Our Expert Opinion

Zoho Books: Best Integrated Business Management Solution

If you are a new startup, and are just starting out in the business world, you are already faced with a number of challenges. One of the biggest challenges you can face when starting a small business is the stiff paperwork that is associated with it.

One of the biggest problems associated with business paperwork is that you need to attend a lot of meetings and pay a lot of money. Not to mention, that even when it comes to tracking money and profits, small business accounting software is not the most user-friendly software out there.

The good news is that with a good small business accounting software, you can start your business without worrying too much about accounting software or paperwork. You can be sure that you’ve got the best small business accounting software and your small business is going to run smoothly.

One of the best software in this category is Zoho Books. It has a lot of features such as accounting, management, sales force and inventory management and even a spreadsheet for you to work with. And best of all, it’s free.

Our Expert Opinion

Xero: Best for Inventory Management

Xero is an accounting software that helps small businesses manage all aspects of their accounting: with a simple interface, people can quickly input customer receipts and other accounting documents, or they can use the online invoicing feature to process payments. Xero is designed for simplicity, with tools and features that put the emphasis on making the system intuitive and easy to use.

The simplified graphically-oriented, streamlined checklist window makes it easy to track transactions such as receipts and payments, loan repayments and bill payments, while not having to list the details. The small business accounting software allows you to track expenses based on who pays and who receives, and to log mileage for business vehicles.

And because small businesses have to handle money transactions, it’s important that you process expenses quickly and accurately. However, Xero gives you the ability to single-click transactions for direct processing, or to optionally convert them to checklists. In addition, notes can be added to transactions, which gives you the opportunity to attach useful information, such as contact details or the invoices’ reference numbers.

Because Xero is web-based, you have the flexibility to collaborate on multiple systems concurrently – allowing you to keep a single Xero account at your office or online on your home network. And with online back-ups, you can protect your valuable data from a disaster.

Our Expert Opinion

QuickBooks Desktop: Best Desktop Accounting Software

Let’s face it… accounting is no fun. With QuickBooks Desktop, you can easily track your company expenses, monitor your incoming and outgoing cash, and more.

QuickBooks Desktop offers a wide assortment of tools for a variety of businesses. With payroll, sales, inventory and just about any other important aspect of your business, you can easily track it all.

This means that you don’t need to hand out invoices or pay a third party to provide accounting services for you anymore. You can do it yourself, with one handy application.

QuickBooks also makes it easer for your accountant to audit your accounting records. A single audit can find a multitude of errors while a double-entry audit only needs to be performed once.

However, although QuickBooks is a great easy to use accounting program, its desktop version can’t go head to head with some of the industry leaders.

For example, Intuit’s accounting suite H&R Block Online is just as easy to use as QuickBooks, but offers just as many powerful tools and features. Among these tools is an audit tool that makes it easier for your CPA to verify your accounting records.

Our Expert Opinion

Wave: Best Free Small Business Accounting Software

Wave is a free online accounting software which is easily the most powerful and feature-packed of the free online accounting systems, and proves its worth in many ways.

Its user interface is intuitive with helpful wizards for every task. It’s a one-stop-shop for all your business needs, right down to accounting for stock and inventory, payroll and invoicing.

You can even import your bank statements and manage your inventory in it. Wave even has a business management system which allows you do all your essential needs; it allows you to handle a range of business functions including sales, marketing and forecasting, finance and accounting, HR, and customer relationship management.

Wave is available to Windows, Mac and Android devices with an iOS app in development. In other words, Wave is a versatile, feature-packed tool for any small business, whether you choose to use it as your sole accounting system or just a few of it’s advanced features. But what really puts it over the top is it’s exceptional support. Its online community is active and its forums are filled with helpful discussion. In addition to a host of resources and tutorials, you can even chat with the team directly from your mobile device.

If you want to enjoy all the simplicity of accounting software and all the advanced features without having to pay any subscription fees, Wave represents the ideal way to do it.

Our Expert Opinion

Sunrise: Best Free Accounting Software With an Option for Online Bookkeeping Assistance

Sunrise works on a system of recurring invoices, which means you can track your transactions at a very granular level. This, along with a free 15 month subscription, makes it a wonderful choice.

You can manage all your financial affairs from any device, which is useful if you’re not near your PC and need help socking away taxes. It also has the ability to extend to mobile devices and an online accounting portal.…

When it’s working the way it’s supposed to, Sunrise is easy to navigate. However, you’ll need to learn the quirks and potential errors before you’ll be comfortable with it. This kind of program isn’t for everyone, but it definitely has its users.

A free 15 month subscription is included with the purchase of a Sunrise application and you can also rent a large scale version for those with greater needs.

Our Expert Opinion

How to Choose Your Small Business Accounting Software

When it comes to small business accounting software, it’s important to choose the right program for your needs, and likewise, stay on top of the software’s routine updates and upgrades. Unfortunately, you also need to budget for all the related project/expense management tools, filing system and security options, and, of course, the new hardware that comes along with the specialized accounting software. Just the physical space alone for the USB drive for backup and the lap top computer for data entry/output can be cumbersome, but it’s important to have in case of a disaster.

So what do you need to keep in mind?

Are you going to be running your business out of your home office? If you are, you need to take into consideration the available space for the software system, the availability of both broadband internet and power, and the hardware that will work the best with the software.

Whichever you decide, here’s a list of the basic attributes to look for in tracking business expenses and managing your business:

What Small Business Accounting Software Costs

When it comes to small business accounting software, there are a range of choices that you need to consider. Before you choose a specific product, you need to evaluate the software’s features, level of support, and price.

A wide menu of available software solutions means that there are plenty of features to choose from, but when choosing the right software, it’s important that there’s at least one option that fits into your budget. Here’s are the best small business accounting software solutions, along with their prices and their features so you’re better able to decide which software option is right for you.

Why You Need Small Business Accounting Software

As a small business owner, there are many tasks that need to be accounted for. You need to have a good record of all financial transactions both on paper and digitally. For this purpose, you can use accounting software. Accounting software can be used to do all types of accounting activity.

Accounting software is very helpful for small businesses to manage their business and income, pay business tax, calculate profit and loss, payroll, managing financial information, and also calculate the balance of your account.

Though there are many different types of software available in the market, the three software we will review are Quickbooks, Wave Accounting, and Xero Accounting.

Quickbooks is an accounting software designed specifically to cater the needs of small businesses. It has pre-installed business features for small businesses. The user interface of Quickbooks makes it easy for anybody to use the software. Also, Quickbooks provides online tools specifically for small businesses like payroll, inventory management, small business loan, and others.

Wave Accounting is regarded as one of the best accounting systems. The software is designed for small business accounting. The user interface of Wave Accounting is simple and user-friendly. Also, you can easily learn and implement the system.

Consider Industry-specific Accounting Software

Accounting Software For Small Business Two of the more popular and accessible platforms on the market are Quickbooks and Xero. Quickbooks offers more than 30 industry-specific accounting solutions.

While both Quickbooks and Xero offer a similar line-up of features, Xero caters to a much smaller range of businesses because of its focus on smaller enterprises.

We’ve compiled a table comparing the pros and cons of both software packages below.


Data Portability: If you transfer data from Quickbooks to another program or hard drive, the info will be permanently saved and easily accessible.

Separate Accounting and Customer List: Quickbooks allows you to create separate marketing accounts or lists which you can share with your management or your clients.


Not a Free Product: Quickbooks isn’t free, but it does have many affordable versions.

Lacking Contrast and Realism: Quickbooks isn’t as visually appealing as other options on the market.

Good for Small Businesses: Xero is designed to cater to smaller firms, so you’ll find money-saving tools which are available only to businesses that are operating on a smaller scale.

Online Bookkeeping Services

If you run your own small business, you probably know more about your business than anyone else does. So why leave all the accounting to an accountant when you can perform the tasks yourself? If you’re still on the fence about doing the bookkeeping yourself, here are a few reasons it’s a good idea: …

You control your costs. When you use an online bookkeeping service, you’re almost always billed per hour. You’re not using your accounting software, but instead billable hours. So writing this off to your taxes. This is a great way to control your costs as you can only charge what you think your clients are willing to pay for the services you provide.

Online bookkeeping tools make it easier for you to keep your books in order. If you’re the chief operating officer at a small business, you don’t have time to file a lot of reports. And you’ve probably already gone to all that trouble to do so. Why would you want to do that all over again when you can use an accounting software that will do it for you automatically?

Bottom Line

QuickBooks vs. FreshBooks

One of the largest problems with small businesses is that they have a difficult time keeping their books up to date. Owners are busy running their business and don’t always have the time to deal with accounting problems. This is why it’s so important that small businesses have a solid accounting program in place to help keep them organized.

After evaluating 15 different accounting software packages, we’ve concluded that 3 are the best options for small businesses. They’re all open source, which means you get access to everything you need to operate without spending a single dime. They’re affordable, and they come with powerful features that can boost your productivity.

Here are the three top picks:

Quicken home and business offers you the ability to manage every aspect of your budget. From small businesses to large corporations, there’s something for everyone.