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  #131  
Old 01-26-2012, 12:22 AM
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JimLewis JimLewis is offline
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Ok.
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  #132  
Old 01-26-2012, 01:12 AM
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BINKY1902 BINKY1902 is offline
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...................
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  #133  
Old 01-26-2012, 01:24 AM
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Quote:
Originally Posted by gscapes View Post
Yes you are correct Binky! Learned that before i got my four year management business degree. But i am a corporation not sole proprietor so that means i am an employee of that corportation, and my title is CEO! Just a question, either of you go to college? And Jim, a Guy who runs a company your size for 16 years should know that if your company is incorportated than you are an employee of your company even if your title is all these CEO, CFO, President, VP and own 100% of the shares of stock for your company

Yes, how the business is set up changes things. I was a sole proprietor, corporations have different standards. I just wanted to throw that info. out there because I know there are a lot of sole proprietors on here like me. I actually have a business degree as well, I'm still in school trying to finish my hours to become a Certified Public Accountant.
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  #134  
Old 01-26-2012, 07:46 AM
gscapes gscapes is offline
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Binky congrats on trying to finish up your CPA and running a landscape business. It is very hard to do both. Then binky since you studied accounting, would you agree with me that your profit is what is left over after expenses, and the CEO salary in a corporation is a business expense, Jim Lewis who is a corporation thinks profit is his salary plus end of year profits.
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  #135  
Old 01-26-2012, 09:36 AM
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Landscraper1 Landscraper1 is offline
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gscapes, I know where you are coming from but, I don't think your understanding JimLewis. You are looking at what comes down on paper but, that is not always a good indicator of the success of a company. Like I mentioned in an earlier post, I had to spend alot of money at the end of the year. The reason was because I was about to have a big profit that year. If I didn't spend that money, the taxes would have eat a large portion of it.

So, if you look at my financials for 2011, it looks OK, not great. But, the truth is, It was one of my most successful years.

Last edited by Landscraper1; 01-26-2012 at 09:44 AM.
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  #136  
Old 01-26-2012, 09:46 AM
32vld 32vld is offline
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Quote:
Originally Posted by BINKY1902 View Post
Yes, how the business is set up changes things. I was a sole proprietor, corporations have different standards. I just wanted to throw that info. out there because I know there are a lot of sole proprietors on here like me. I actually have a business degree as well, I'm still in school trying to finish my hours to become a Certified Public Accountant.
All I know is that numbers don't lie but liars use numbers to lie.

As you pointed out you can't use just one number to say one business is more profitable then another.

My question for you is can you point out when it would be better to draw out money from a business as salary or profit?

Mitt Rommey paid 13.9 % on $24,000,000. I was told that he must have had himself paid mostly through dividends.
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  #137  
Old 01-26-2012, 10:03 AM
32vld 32vld is offline
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Politician speak.

Is stating info that projects the message you want get people to believe.

Example:

Whether Sol Pro, LLC, Corp

Co A I made $25,000 Salary and $75,000 profit
Co B I made $50,000 salary and $50,000 profit
Co C I made $75,000 salary and $25,000 profit

A claims he's had the best year because he made the highest profits.
C claims he's had the best year because he made the largest salary

B does not claim but states their full of baloney because they all put $100,000 in their pocket at the end of the year.

Now a SP, LLC, and Corp have tax rate advantages and total gross size effects tax rates as well.
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  #138  
Old 01-26-2012, 11:28 AM
BCR840 BCR840 is offline
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I have a full time job for AT&T and operate the Lawn Business as a 2nd income. I have been doing this for 8 years off and on, but got very serious with in the last 3 years. I am fully insured, all equipment is insured, business license, taxes etc. 3 years ago my gross was $8k and my net was $4k. The next year my gross was $30k +_ and my net was around $15-$17k. Now in 2011 my gross was $62k and my net (still calculating) is $24-$25k. Now the difference is the amount of work I took on last year. I did my normal maintenance contracts (12 only) and the rest was all landscape jobs, clean-ups, and one-time visits. I was amazed at how much I grossed as a side business. I did all of this myself except on the larger landscape jobs I had 2 guys help me. I was also amazed at how much $$$ it took to produce that number, i had $14k in just material for jobs. It left me wondering if I should just focus on the maintenance side of things more for this year. I could add a couple of lawns (high end) and just do that and reduce my overhead. But then here comes the tax hit. I was fortunate to be able to use my extra income last year to purchase a used 48" Grandstand, Walker MCGHS, and 2 new Redmax blowers. I got a great deal on the Walker to (2005, 285 hrs., $5700). So all my equipment is paid for now. But I cant help to wonder what taxes will be like this year. My normal expenses will still be there like... insurance, Maint. repairs, license, fuel, labor, materials etc. It was a lot of late nights, studying my plant materials, drawing, and headaches trying to get all of this scheduled around my primary work schedule, a wife, and 3 kids. I am always looking for more ways to save money and make more profit. but really dont feel like i would want to grow to much more and take on that kind of stress and responsibility.
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  #139  
Old 01-26-2012, 05:08 PM
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BINKY1902 BINKY1902 is offline
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Quote:
Originally Posted by gscapes View Post
Binky congrats on trying to finish up your CPA and running a landscape business. It is very hard to do both. Then binky since you studied accounting, would you agree with me that your profit is what is left over after expenses, and the CEO salary in a corporation is a business expense, Jim Lewis who is a corporation thinks profit is his salary plus end of year profits.

Yes the owner of a corp. would expense his salary. Sole proprietors actually don't have a salary, they reduce their equity when they draw. LLC's are also treated like a prop.
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  #140  
Old 01-26-2012, 05:26 PM
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BINKY1902 BINKY1902 is offline
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Quote:
Originally Posted by 32vld View Post
All I know is that numbers don't lie but liars use numbers to lie.

As you pointed out you can't use just one number to say one business is more profitable then another.

My question for you is can you point out when it would be better to draw out money from a business as salary or profit?

Mitt Rommey paid 13.9 % on $24,000,000. I was told that he must have had himself paid mostly through dividends.


Romney pays low tax because investments (dividends) are favored when it comes to taxation. He makes his money from investments, not labor. Basically this is in place to promote the wealty to invest money. This is why the super wealthy pay less tax percentage wise than people working. It is controversial to say the least.
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