FBA CORNER: Ask Funeral Business Advisor
Q. How should I set up my accounts in QuickBooks? - Submitted by Brian Bowser – Hall Funeral Service, Mena, AR
The accounts in your QuickBooks file should be set up in a manner that will enable you to evaluate and monitor your funeral home’s financial results. The most important reason for maintaining accounting records is to have financial information at your disposal in order to make better informed decisions.
With regards to accounts to record your revenues, the revenue accounts should match the categories on your general price list. This enables you to evaluate the effectiveness of your pricing and it enables you to monitor trends in the types of services and merchandise that families are selecting. Examples of revenue accounts would include: professional services of funeral director and staff; embalming, use of facilities for visiting, removal; cash advances, caskets, vaults, cremation package A, direct cremation and so on. QuickBooks enables you to keep track of the not only the revenues by type, but it also keeps track of the number of families that select a particular item.
On the expense side, it is important to record items in such a manner that will enable you to evaluate the costs of providing your services and enable you to determine your overhead. Expenses and costs should be grouped under the following categories: cost of goods sold; cash advances; automobile expenses; facilities expenses; salaries and wages; and general and administrative. These general categories will then capture the detailed items that will facilitate proper evaluation and analysis. For example under the category “automobile,” the following detailed accounts should be used: gasoline; repairs and maintenance; insurance; and registration.
The basic premise behind setting up your accounts is that you want to develop an information system that provides relevant information that will enable you to evaluate your financial health. A common mistake that many accountants and funeral directors make is that they set their accounts up in order to make it easier to prepare income tax returns. This is fine for preparing tax returns, but it does not lend itself to evaluating overhead or cash flow, which is critical to understand and know in today’s competitive environment. Another important point to make is that cash advance revenues and cash advance expenses should have their own accounts. Cash advance expenses should not be found on the chart of accounts among any other accounts. FBA
Ronald H. Cooper, CPA, is a funeral home accountant with Cooper & Associates, CPA, LLC. Please submit your questions to Ron via email at ron@funeralbusinessadvisor.com.
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Q. Podium Microphones – What are my options? - Submitted by Bryan Avance – Avance Funeral Home, Fairfield, OH
Installing a new podium microphone may be the easiest and most affordable upgrade to your audio system. But with so many to choose from, it’s difficult to know where to begin.
Let’s start with the two main types of microphones and their purposes. DYNAMIC microphones are most commonly used for singing and speaking. Dynamic mics are generally used for applications where the user is in very close proximity to the microphone. The major weakness with this type of mic is that its pickup pattern is about 3-6 inches. That simply means that when the user moves outside this range, the level drops significantly and the mic becomes ineffective.
In most cases, your best bet for a podium mic is the second type, a CONDENSER microphone. If a dynamic mic has a useful pickup pattern of 3 to 6 inches, a condenser mic has a pattern of 3 to 6 feet. A Condenser mic uses a power source to increase its sensitivity. This helps a great deal when it comes to picking up the user, whether up close or at a distance. Unfortunately, the sensitivity of this type of mic tends to be its only weakness; if the podium is placed too close to a ceiling speaker or wall speaker, at high volumes, it may feedback.
Webster defines feedback as “the return of a fraction of the output signal from an amplifier, microphone, or other device to the input of the same device.” In other words, the microphone is picking up its own amplified signal in a continuous loop.
In some instances, we are asked about installing a wireless handheld microphone for use as a podium mic. Though wireless technology adds a great deal of flexibility, this does nothing to alleviate the main problem. Most of these wireless mics are just cordless versions of a dynamic microphone. There are a few condenser versions available, so if you plan to upgrade to a wireless for your podium, make sure it is a condenser microphone.
Directors often ask us to quote an upgrade for an entire funeral home sound system; however, in many of these cases, we discover that all they really need is the correct type of microphones.
With this basic understanding, you can make an educated decision on the purchase of a simple but highly effective upgrade for your sound system. FBA
Chris Runnels is the owner of Advanced Audio Systems. Please submit your questions to Chris via email at chris@funeralbuinsinessadvisor.com.
