Accounting software automates an organization's financial functions and transactions with modules including accounts payable, accounts receivable, payroll,.

No How to Choose Bookkeeping SoftwareThe key to choosing the right bookkeeping software is to make sure the software includes features you need to manage your business finances. ✔QuickBooks Self-Employed (QBSE) TurboTax BundleQuickBooks Self-Employed is ideal for an individual or a business that files a and pays most of their expenses with a debit or credit card. QBSE does not have payroll processing or the ability to manage and pay bills.

Unlike other QBO plans, it includes the ability to transfer your data to TurboTax and file both your federal and state tax returns. QuickBooks Online Simple StartQBO Simple Start is an ideal QuickBooks software for small businesses that want to give other users access to their data and also need the ability to pay employees. Unlike QBSE, you can add payroll processing to QBO Simple Start for an additional fee. QBO Simple Start also includes more than 20 reports, like profit and loss, balance sheet, and statement of cash flows. QuickBooks Online Essentials PlanQBO Essentials is ideal for small to medium-sized businesses that need to give other users access to its data and has a lot of accounts payable to manage. Unlike QBSE and QBO Simple Start, QBO Essentials allows you to manage the full accounts payable cycle, including entering bills, managing due dates, and printing checks to pay bills.

It also includes double the amount of reports that QBO Simple Start has (40 versus 20). QuickBooks Online Plus PlanQBO Plus Plan is ideal for product-based businesses that need to keep track of inventory purchases and sales. Unlike the other three QBO plans, QBO Plus includes the ability to track inventory and create budgets and forecasts, plus it has more than 65 reports. QuickBooks Online Advanced PlanThe best small business accounting software for fast-growing businesses is QBO Advanced. QBO Advanced allows up to 25 users with customized access permissions.

QBO Advanced also includes Fathom, a reporting tool that allows you to generate customized reports for key performance indicators (KPI). You also get a dedicated account manager and free self-paced training for your staff.Based on our minimum criteria, here is how QBO stacks up against its competitors: CostCompared to its competitors, QBO gives you the best deal for your money. The QuickBooks Self-Employed plan starts at $15 per month, which is almost double the cost of the starter plans for Xero and Zoho Books. However, it includes the following features that you won’t find in any of its competitors on our list:. Separate personal and business expenses.

Quarterly estimated tax calculations. Mobile mileage tracker. Integration with TurboTaxSetup & Ease of UseQBO is more complex to set up compared to FreshBooks, Zoho Books, and Wave. This is because, like Xero, it is much more robust than other accounting software solutions. However, navigating the program is very easy.Like other software packages on our list, QBO doesn’t require a bookkeeping background to set up. Anyone familiar with online software applications will be able to pick up QBO quickly.

However, if you need some guidance or have questions, you can look for a. Manage Accounts ReceivableSimilar to all of the other solutions we have listed, QBO allows you to create customized invoices to bill your customers for the products and services you have provided. In addition, you can keep track of unpaid invoices by running an accounts receivable aging report. Staying on top of your accounts receivable balances helps you avoid the need to send collection letters.

Manage Accounts PayableThe Essentials, Plus, and Advanced QBO plans allow you to track your outstanding balances with suppliers. QBO Essentials, Plus, and Advanced also include the ability to enter bills, pay bills, and run an accounts payable report to review open balances. These features are not available in Wave, Zoho Books, or FreshBooks.

Connect Bank & Credit Card AccountsThe beauty of using cloud accounting software like QuickBooks Online is that you can connect your bank and credit card accounts to the software. Similar to the Xero Early plan, QBO Self-Employed and Simple Start limit the number of transactions you can download. However, QBO Essentials, Plus, and Advanced allow you to connect an unlimited number of bank and credit card accounts.

Payroll ProcessingUnlike FreshBooks and Zoho Books, which do not have a payroll add-on, four of the five QBO plans let you add payroll services. The two QBO payroll plans are self-service and full-service. Self-service Payroll:. Cost: $35 per month plus $4 per employee, per month. Services included: The employer can process payroll for all employees and contractors (including 24-hour direct deposit and check payments), file and pay all payroll taxes directly from QuickBooks, and print and mail W-2 forms.Full-service Payroll:. Cost: $80 per month plus $4 per employee, per month.

Services included: The employer provides hours worked during each pay period and the system processes payroll for all employees and contractors, including same day direct deposit and check payments. Depending on your subscription level, QBO Full-service Payroll also files and pays payroll taxes on your behalf, and prints and mails W2 forms.Accept Online PaymentsLike all of its competitors, QBO lets you get paid faster by adding online payments to your account. Unlike similar small business accounting software, QuickBooks is the only product that has its own online payments processor, QuickBooks Payments.Below are the fees associated with adding online payments to any QBO plan.

Limited.Additional users can be added for $10 per user, per month. FreshBooks Lite PlanFreshBooks Lite is perfect for a startup business with no more than five clients who need invoicing each month. This plan is the most economical out of the four plans at $15 per month. Similar to Wave, FreshBooks does not allow you to track your accounts payable balances. FreshBooks doesn’t include payroll processing either, but it does integrate with Gusto payroll.

FreshBooks Plus PlanFreshBooks Plus is ideal for a freelancer with no more than 50 clients who need to be invoiced monthly. At $25 per month, this plan is less expensive than QBO Essentials, which is $40 per month.

However, QBO allows you to bill unlimited clients versus only 50 with FreshBooks Plus.Unlike QBO Essentials, this FreshBooks plan does not have accounts payable (A/P) management. You can add the Gusto payroll app that can process paychecks, payroll tax payments, and tax filings. FreshBooks Premium PlanFreshBooks Premium is great for small to medium-sized businesses with up to 500 clients who need to be invoiced monthly. This plan is $50 per month versus $70 per month for QBO Plus.

FreshBooks Premium does not have accounts payable, the ability to track your mileage, or a way to capture and organize receipts, all of which are available in QBO Plus. FreshBooks Select PlanFreshBooks Select is a fitting choice for a business that has a large volume of credit card transactions. With this plan, you can qualify for a lower credit card transaction rate based on your transaction volume. Similar to QBO Advanced, FreshBooks Select includes a personal account manager and custom training for you and your team.Based on our minimum criteria, here is how FreshBooks compares to its opposition: CostWhen it comes to cost, FreshBooks plans start at the same price as QBO’s Self-Employed plan, $15 per month.

However, FreshBooks is missing a few features and is limited in some of the others. For example, most of the FreshBooks plans put a limit on the number of customers you are able to bill on a monthly basis.All FreshBooks plans are missing or limited in the following features:. Accounts payable tracking: None of the FreshBooks plans allow you to track accounts payable. Client invoicing: The Lite, Plus, and Premium plans limit the number of clients you can invoice each month. User access: All plans include one user.

Each additional user costs $10 per month.Setup & Ease of UseAs mentioned previously, FreshBooks is easier to set up than QuickBooks because it is not quite as robust. The average internet user should have no problems setting up their business in FreshBooks. Similar to all of the competitors on our list, it’s very easy to navigate around the FreshBooks program.

Manage Accounts ReceivableOut of all the small business software discussed here, FreshBooks allows you the most flexibility to create invoices that suit your brand. With FreshBooks, you can choose the style, font, and colors that match your brand. You can also set up automatic payment reminders and automatically charge late fees for overdue customer invoices.

Additionally, you can stay on top of open balances by running an accounts receivable aging report. Manage Accounts PayableSimilar to Wave and Zoho Books, FreshBooks does not have the ability to manage and pay bills. You also can’t run reports in FreshBooks to see balances owed to your suppliers, and you can’t print checks through the accounting software to pay your bills like you can in QuickBooks. However, if you pay most of your expenses through your bank account or credit card, FreshBooks may work for you.

Connect Bank & Credit Card AccountsUnlike QuickBooks Self-Employed and Simple Start, FreshBooks does not limit the number of transactions or bank and credit card accounts you can connect. You can connect all your bank and credit card accounts to all three FreshBooks plans. This will save you a lot of time that you would have spent entering banking and credit card transactions manually. Payroll ProcessingQBO has a built-in payroll processing tool that you can turn on after paying an additional fee, but FreshBooks does not.

However, the good news is that you can visit the FreshBooks Apps page to sign up for Gusto Payroll, which integrates with FreshBooks. Accept Online PaymentsLike QuickBooks, FreshBooks allows you to accept online payments for an additional fee. FreshBooks does not have its own credit card processing system like QBO does, so you will need to visit the FreshBooks Apps page to select a payment processor to start receiving online customer payments.

Prepare Key Financial StatementsFreshBooks can only produce one out of the three primary financial statements. You can create a profit and loss report, but you cannot run a balance sheet or a statement of cash flow report in FreshBooks. A profit and loss report only shows the income and expenses of your business during a specific time frame, typically a month.

However, without the balance sheet and the cash flow statement, it is difficult to see the whole financial picture for your business.The balance sheet not only shows the current position of the business, it also shows assets owned by the business, long-term debt such as loans, and the amount the owner has invested into the business. A cash flow statement shows patterns and trends in regard to money flowing in and out of the business. This information allows for forecasting and accounts payable management in current and future months.

Without these integral reports to guide your business decisions, your business is almost running with blinders on. What FreshBooks Is MissingAs mentioned previously, FreshBooks can only generate one out of the three key financial statements required. Additionally, you have to create a manual bank reconciliation report to ensure all bank and credit card balances match up with your bank and credit card statements. Bank reconciliations are mostly automated in QuickBooks Online.

Transactions from your bank feed are matched with expenses and revenue, making most bank reconciliations as easy as clicking a button. With QBO, you can also generate all three of the primary financial statements in just a few minutes. FreshBooks ReviewsAccording to, users like how easy it is to do the customer billing, how much time they save by using the automatic invoice reminders, and how they can apply late fees to past due invoices. On the negative side, customers don’t like that FreshBooks is missing key financial reports, like the balance sheet and the statement of cash flows.: Best QuickBooks Alternative Small Business Accounting SoftwareIf you’re looking for an, Xero may be your best choice. Out of all the competitors we included, Xero comes closest to offering the features found in QuickBooks. Xero does not charge a fee per user or limit the number of users you can have. Pricing runs between $9 and $60 per month.

Xero Pricing & FeaturesXero has three pricing plans, Early, Growing, and Established, and it costs between $9 to $60 per month. All Xero plans allow you to give any number of users access to your data, connect unlimited bank and credit card accounts, and run key financial statements.Below are the features included in all Xero pricing plans:. Grants an unlimited number of users.

Supports connecting bank and credit card accounts. Provides unlimited email tech support. Empowers you with access to key financial statementsXero Accounting Software Plans Comparison & Summary. ✔Xero Early PlanXero Early plan is ideal for a startup business that has not generated many transactions. While the Early plan does have accounts payable and accounts receivable, you are limited to only five transactions per month. This means you can manage and pay up to five bills and send no more than five invoices or quotes to customers each month.

Xero Growing PlanXero Growing plan is optimal for a small business that needs to track accounts payable, accounts receivable, and multiple bank and credit card accounts. Unlike the Xero Early plan, you can process unlimited bills, invoice an unlimited number of customers, and connect all of your bank and credit card accounts. Xero EstablishedXero Established plan is excellent for small to medium-sized businesses that have expanded or plan to expand globally. Unlike the Early and Growing plans, the Established plan includes multicurrency accounting so you can create invoices, pay bills, and track bank accounts in more than one currency. This plan also lets you track expenses as well as project time and costs.Based on our minimum criteria, here is how Xero stacks up against its competitors: Setup & Ease of UseXero is similar to QuickBooks when it comes to setup and ease of use.

Because Xero is a much more robust small business accounting software than FreshBooks, Zoho Books, and Wave, it takes some additional time to set up certain areas like the chart of accounts and multicurrency accounting. However, it is very easy to navigate Xero, in part because the company uses simple language rather than accounting jargon throughout the program.

Manage Accounts ReceivableLike its competitors, Xero plans include the ability to invoice customers, track payments, and stay on top of open accounts receivable balances. However, as with most tiered pricing plans, features are limited in the lower tiers. For example, the Xero Early plan limits invoicing to five customers per month.

Manage Accounts PayableAll three Xero plans include the ability to manage accounts payable. However, like its accounts receivable features, Xero’s accounts payable module limits the number of transactions you can process. You are only allowed to manage up to five bills per month with the Early plan. Upgrading to the Xero Growing and Established plans allows you to manage an unlimited number of bills. Connect Bank & Credit Card AccountsAll three Xero plans include the ability to connect bank and credit card accounts. Much like QuickBooks Self-Employed and Simple Start, Xero limits the number of transactions you can reconcile in the Xero Early plan. The Growing and Established plans allow you to connect an unlimited number of bank and credit card accounts.

Payroll ProcessingLike its competitors, payroll processing is not included in any of the Xero pricing plans, but it can easily be added for an additional cost. You can visit the Xero App marketplace to add Gusto Payroll to your Xero account. Gusto can handle all paycheck processing as well as payroll tax payments and filings. Accept Online PaymentsSimilar to other accounting software, Xero allows users to offer online payment processing to customers through PayPal, Stripe, or Apple Pay. Just visit the Xero app store to select a payment app and follow the instructions to get started.

Prepare Key Financial StatementsMuch like its opposition, Xero has detailed reports, like the profit and loss statement and aging reports, to help you keep track of open customer invoices and outstanding bills. You can also run bank reconciliation reports to ensure that your accounts agree with the actual bank account balances. What Xero Is MissingWhen it comes to product features, Xero is not missing any key feature that a small business needs. However, there are a couple of areas where QuickBooks beats Xero. First, all QBO plans include live telephone support while Xero only offers support via email.

Because of their customer support processes, many people find a free to be extremely educational. Xero Reviewsindicate most consumers like how intuitive the user interface is and how easy it is to navigate within the program. Users also feel that the program lacks modern features, like cloud storage and tax software integration. Taking a moment to read over can be extremely helpful when considering which software package is best for your business. Wave: Best Free Small Business Accounting SoftwareWave is our choice for best overall, making it ideal for businesses on a tight budget. Wave meets seven out of the eight criteria we used to evaluate software.

The one area where it falls short is the inability to track and pay vendor bills. Wave PricingWave is free, so it is the most affordable bookkeeping software on our list. Even though it is free, it is fairly robust and has much of the functionality you’d expect from a small business software for bookkeeping. Wave FeaturesCompared to its competition, Wave includes most of the features needed to run a small business.

However, it falls short when it comes to managing accounts payable. You can enter unpaid bills into Wave, but you will have to manually mark them as paid. Setup & Ease of UseLike other software of its kind, including FreshBooks and Zoho Books, Wave is very user-friendly. Setup doesn’t take long and you don’t need an accounting or bookkeeping background to complete the setup for your business. Manage Accounts ReceivableWave allows you to create custom invoices to send to your customers.

You can also manage open invoice balances using the accounts receivable aging report and follow up with customers before invoices are due or immediately after. Manage Accounts PayableWave accounting software does not include accounts payable functionality.

You can enter your bills and manually mark them as paid. You cannot print checks directly from Wave to pay your bills like you can with QBO. Connect Bank & Credit Card AccountsYou can connect all your bank and credit card accounts to Wave, just like you can with QuickBooks. Wave does not limit you to a certain number of transactions or accounts like QBO Self-Employed and Simple Start do. Payroll ProcessingSimilar to FreshBooks, Xero, and QBO, Wave makes it easy to add payroll processing, but there is an additional cost. Wave Payroll allows you to process paychecks as well as calculate and file payroll taxes and forms. Wave Payroll Fees.

1% per transaction ($1 minimum fee)Prepare Key Financial StatementsWhen it comes to financial reports, Wave has a number of detailed reports to help you stay on top of your business’ health. Similar to QuickBooks and Xero, Wave lets you run a profit and loss statement, balance sheet, and a statement of cash flow report.

What Wave Is MissingLike FreshBooks, Wave falls short when it comes to managing unpaid vendor bills. Because you cannot pay your bills directly from Wave, entering and paying bills is a completely manual process. Wave Reviewsshow that users like the fact that this is a free bookkeeping software.

However, they also feel that a significant improvement is needed when it comes to customer service, as live customer support isn’t available. To get help, you need to send an email to the support team and wait for a response.: Best Accounting Software for Zoho UsersZoho Books is ideal for existing Zoho users because it integrates with a suite of Zoho products, setting it apart from other accounting software solutions. Instead of using several products to manage your business (e.g., CRM, inventory), you can connect a Zoho app and it automatically syncs with Zoho Books. Pricing plans are $9 to $29 per month.

Zoho Books Pricing & FeaturesZoho Books is the most economical paid bookkeeping software on our list. The plans cost between $9 and $29 per month versus the QuickBooks plans, which run between $15 and $150 per month.All Zoho Books plans include:. Ability to give multiple users access to the financial records.

Allows for bank and credit card account feeds. Provides the capability to accept online payments.

Supports key financial reports (e.g., profit and loss, balance sheet)Zoho Books Accounting Software Plans Comparison & Summary. ✔Zoho Books Basic PlanZoho Books Basic is excellent for a small business that has no more than 50 customer, vendor, and employee contacts to manage. Because the plan doesn’t have accounts payable functionality, it works best for those businesses that pay most of their bills using a debit card, credit card, or automated clearing house (ACH) payments. Zoho Books Standard PlanZoho Books Standard is perfect for a growing business that has fewer than 500 customer, vendor, and employee contacts to manage.

Unlike the Zoho Basic plan, the Standard plan lets you manage your open accounts payable balances by entering bills, paying bills, and running an accounts payable aging report to see open balances. Zoho Books Professional PlanZoho Books Professional is optimal for small businesses with more than 500 customer, vendor, and employee contacts.

In addition to allowing an unlimited number of contacts, Professionals also allows ten users access to your data versus one user (Zoho Basic) and two users (Zoho Standard).Based on our minimum criteria, here is how Zoho Books compares to its competition: Number of ContactsSimilar to FreshBooks, which limits the number of customers you can invoice in two of their four plans, Zoho Books limits not only the number of customers but also vendors and employees that can be managed in two out of their three plans. QuickBooks, on the other hand, allows you to manage an unlimited number of customers, vendors, and employees in all their plans.

Setup & Ease of UseZoho Books is very easy to set up and navigate. Because it doesn’t have all the bells and whistles that QuickBooks has, you can setup your chart of accounts, products, and services lists pretty quickly. Manage Accounts ReceivableAll Zoho Books plans allow you to manage full-cycle accounts receivable. This includes creating custom invoices, managing customer payments, and staying on top of balances due with the accounts receivable aging report.

Manage Accounts PayableZoho Books Basic is similar to QBO Self-Employed and Simple Start in that it does not include accounts payable functionality. This means that you cannot enter and pay your bills with the Zoho Books Basic plan. However, you can with the Zoho Books Standard and Professional plans. Connect Bank & Credit Card AccountsYou can easily connect all of your bank and credit card accounts to Zoho Books. Unlike QuickBooks Self-Employed and Simple Start, none of the Zoho Books plans limit the number of accounts or transactions you can process. Payroll ProcessingPayroll processing is another area where Zoho Books falls short. Currently, it is only able to process payroll for employers in California, Texas, and India.

Unlike their other possibilities, Zoho Books is not compatible at this time with any other payroll apps. Accept Online PaymentsAll Zoho Books plans allow you to offer your customers the ability to pay their invoices online. Similar to other accounting software, Zoho Books has an apps center where you can find a payment app to connect to your Zoho Books account.

Prepare Key Financial StatementsYou can prepare the three key financial statements in Zoho Books: profit and loss, balance sheet, and statement of cash flows. Additionally, you can run detailed sales reports and expense reports. What Zoho Books Is MissingThe biggest drawback to using Zoho Books is the fact that the payroll processing is limited to California, Texas, and India.

As a result, if you decide to use Zoho Books, you will need to use a payroll service like Gusto to pay your employees. Zoho Books Reviewsshow that consumers like how easy and affordable the product is for small businesses. However, Zoho Books users don’t like that they cannot process payroll for their employees through Zoho Books.: Accounting Software for Niche IndustriesQuickBooks Premier is a desktop software that meets all eight of our criteria and is ideal for nonprofits, manufacturers, professional service businesses, contractors, and retailers that make less than $1,000,000 in annual sales and have no more than 20 employees. For a one-time fee of $499.95, QuickBooks Premier comes with a customized chart of accounts and custom reports for the above-mentioned industries. ZipBooks: Bookkeeping Software for Startup BusinessesZipBooks is best for startup businesses that are currently using an Excel spreadsheet or other antiquated methods to keep track of its income and expenses. The ZipBooks Starter plan is free, and their paid plans run between $15 and $35 per month.

Their top-tier plan, ZipBooks Accountant, is a custom pricing tier for accountants with multiple clients. ZipBooks meets all but two of our criteria—it does not track accounts payable and you cannot process payroll for employees.ZipBooks’ features helped it earn a spot on our list of. Show most users regard ZipBooks positively. Bonsai: Alternative Accounting Software for FreelancersBonsai is best for freelancers who submit proposals to prospective clients and write contracts. Bonsai’s contract functions go a step further by allowing you to customize contracts from within the software, have them signed electronically by your client, and then store them online.Bonsai offers plans starting at $16 per month. It does not include payroll functions because it was specifically designed for freelancers, but it does offer unlimited clients and proposals as well as time tracking tools.Bonsai is another to consider if you’re a busy freelancer.: Bookkeeping Software for Online RetailersGoDaddy Online Bookkeeping (GOB) is best for online retailers and ecommerce sellers. Plans start at $4.99 per month with their Get Paid plan and tops out at $14.99 per month with their Premium plan.As an online seller, you probably sell on multiple platforms.

GOB comes out of the box with Amazon, Etsy, eBay, and PayPal sync capabilities, allowing you to consolidate your online sales in one place for a high-level overview of your business’ financial health. Although it is capable of syncing with multiple online platforms, GOB works particularly well for.offer insight into the pros and cons of the software. Most users found the package useful, while some users found its customer support to be lacking.

Comments (169). Likes (2)Disclaimer: Reviews on FitSmallBusiness.com are the product of independent research by our writers, researchers, and editorial team. User reviews and comments are contributions from independent users not affiliated with FitSmallBusiness.com's editorial team.

Banks, issuers, credit card companies, and other product & service providers are not responsible for any content posted on FitSmallBusiness.com. As such, they do not endorse or guarantee any posted comments or reviews.Marine Scott.

Hi!Informative blog. I appreciate the way you have described and mentioned all the terms of accounting software. In this Era, choosing the best accounting software for business is the most important part.

Every business owners, CPAs, accountants want to manage their finances in easy, fast and in a secure way because nowadays solving the accounting problems with the help of paperwork is less effective. So the best software is needed to manage accounting activities and as about to choose the best one, my recommendation is QuickBooks.

It is the most popular accounting software in the world which is used for small to medium-sized businesses. It is user-friendly as well as helps in tracking expenses. You can use it to pay bills, tax filing, generate reports for planning, invoice customer, and more. Hi Crystalynn!

Thank you for sharing such a knowledgeable blog with us. I appreciate the work you do for this site. I am also using one of the accounting software for the last 10 months named BTHAWK.I do every task related to accounting starting from bookkeeping tasks till making financial statements like balance sheet, trading & P&L, etc. Through BTHAWK, I also able to file tax returns online.So I would suggest you have a look at it once. Besides this, I like this blog site as it always gives me a chance to read informative content.Keep blogging and looking for more content in the future.bthawk.com, GST Billing Software-BTHAWKThank You. Advertiser DisclosureAt Fit Small Business, our mission is to deliver the best answer to people’s questions.

The best answers often include products and services. We sometimes make money from our advertising partners when a reader clicks on a link, fills out a form or application, or purchases a product or service. Naruto ninja council 3 ds. We only partner with companies we believe offer the best products and services for small business owners.

And, because we value transparency, we’ve chosen to provide a.Furthermore, Fit Small Business never allows partners to pay us to guarantee placement within an article that isn’t clearly marked as sponsored and companies cannot pay us for favorable (or unfavorable) reviews or ratings.Read more about our commitment to editorial independence.

If you’re looking for small business accounting software, you have no shortage of choices.While that’s great, it can also be confusing. In order to cut down on the confusion and have a better idea about just what you’re looking for, it’s best to decide what features you absolutely must have and work from there.Our top ten applications range from simple accounting software designed for sole practitioners to feature-laden applications that grow along with your business.

Out top 10 picks for the best accounting software:.Our Picks The 10 best accounting software for your businessStill wondering if that application you’re interested in is affordable, if it’s online, or if it includes a payroll module?Read on as we do our best to answer any lingering questions you may have about our top 10 accounting software applications.If you have further questions, be sure to check out our complete accounting software reviews. Accounting software is available in a variety of price points.

Some applications can run to hundreds of dollars per month, though most entry level accounting software will top off at around $100 per month.There are also some good accounting applications available for free, or less than $10 per month. However, most of those are designed for sole proprietors or freelancers who only need limited features, like invoicing and expense management.Keep in mind that most free or low-cost applications are not equipped to handle payroll or manage inventory. Spreadsheets can be useful, and provide a good way to create custom reports and track simple data. However, spreadsheets have no checks and balances.If your current bank balance is $1,000 and you just wrote a check for $500, you would have a balance of $500 in your account. But what happens if you leave off a zero when you enter that check amount on your spreadsheet?You'll think you have $950 in your account instead of $500 and will likely overdraw the account purchasing things you don't have the funds to pay for.If you've never transposed numbers, made a typo, or entered an incorrect formula in a spreadsheet program, then maybe you could get by with using spreadsheets for accounting. But for the rest of us mortals, accounting software is the way to go.