How to Create a Bookkeeping Spreadsheet in Excel in 10 Minutes?

Bookkeeping tracks money going in and out of a business. It shows where the business stands. Every payment received or made should be written down properly. This is true for small businesses and big ones alike. When done right, bookkeeping helps avoid errors and surprises. Excel is a simple tool to do this without buying costly software.

What Is Bookkeeping in Excel?

Bookkeeping in Excel means tracking your income and spending using spreadsheets. A spreadsheet helps you list out all money matters in one place. You can organize them by date, amount, type of expense, or income. Excel formulas can even do the math for you.

Many small businesses want to know how to do bookkeeping in Excel. It’s not hard. It takes a few minutes to set up and then becomes easy to use. This method is great for new businesses or those with fewer transactions.

Why Use Excel for Bookkeeping?

Before we start with steps, it helps to know why Excel is a good tool.

1. It’s Cheap and Easy to Get

Microsoft Excel is part of Office tools that most people already use. If not, Google Sheets can also work. You don’t have to spend money on software.

2. Simple Setup

You don’t need training to begin. A simple Excel sheet can do the job. If you know how to enter data in rows and columns, you’re ready.

3. Full Control

You decide what to include. You can add more columns, insert formulas, or delete what you don’t need.

4. Good for Startups and Small Firms

When you don’t have many transactions each day, Excel works well. You don’t need complex software.

5. Great for Reports

You can track your totals, profits, or loss easily. Filters and graphs in Excel can help you see trends quickly.

This method of bookkeeping with Excel is fast, clear, and flexible.

Steps to Create a Bookkeeping Spreadsheet in Excel

Now, let’s move to the actual steps. You can create a basic bookkeeping spreadsheet in Excel in just 10 minutes. This will help you start tracking your business money right away.

Step 1: Open Excel and Create a New File

Click on Excel. Go to “File” and select “New Workbook.” A blank spreadsheet will open.

Step 2: Name the Worksheet

Double-click the sheet tab at the bottom. Name it something simple like “Bookkeeping.”

Step 3: Set Column Headings

Start from cell A1. Type these labels across the first row:

• Date
• Description
• Category
• Income
• Expense
• Payment Mode
• Notes

You can add more columns later if needed.

Step 4: Format the Columns

Make “Date” column format to show proper date. Set “Income” and “Expense” as currency.

To do this:
Right-click on the column → Format Cells → Choose Date or Currency.

Step 5: Start Entering Data

Begin from row 2. Add real business entries. Each row is a new transaction.
Example:
| 01/06/2025 | Client Payment | Sales | ₹5000 | ₹0 | UPI | Received from client |

Step 6: Use Formulas for Totals

In the Income column (say E), write this in the last row:
=SUM(E2:E100)
Do the same for the Expense column.
To get net total:
In another cell:
=SUM(E2:E100) – SUM(F2:F100)
This shows your monthly profit or loss.

Step 7: Add Filters

Select row 1 → Click “Data” → Click “Filter.”
This lets you sort by date, category, or amount.

Step 8: Add Conditional Formatting

This helps to spot large payments or expenses.
Select the Income or Expense column → Home → Conditional Formatting → Highlight rules (e.g. above ₹10000)

Step 9: Save Your File

Click “File” → “Save As” → Pick a location → Name your file clearly, e.g., June2025_Bookkeeping.xlsx

Step 10: Backup Your Sheet

Copy the file to cloud or USB to avoid losing it.

This simple setup is all you need to get started with bookkeeping in Excel.

Using Excel for Ongoing Bookkeeping

Once the sheet is set, update it regularly. Daily is best. At the end of the week or month, review the totals.

Make a new sheet for each month. Name them by month names. For yearly view, you can link the monthly sheets to a summary sheet.

This way of bookkeeping with Excel can track business activity for the full year.

How to Do Bookkeeping for Small Business in Excel?

Running a small business comes with many tasks. Bookkeeping in Excel helps you stay in control of money. Here’s how to keep it simple:

• Record every sale or income you get
• Add every purchase, payment, or expense
• Use the “Category” column to group types (rent, salary, travel, sales)
• Run totals every month
• Check if your income is more than expenses
• Review unusual spending

You can also color code income and expenses for clarity. This will make your bookkeeping excel file easier to read.

Tips to Improve Your Excel Bookkeeping Spreadsheet

To make it work better for you, try these tips:

1. Create a Drop-down List

In the Category column, you can add a list of fixed values:
Click “Data” → “Data Validation” → Enter your categories like “Rent, Travel, Salary, Sales”

2. Lock Formulas

Prevent changes in cells with formulas.
Select cells → Right-click → Format → Protection → Lock → Then protect the sheet

3. Use Color Highlights

Shade income cells green and expenses red. It improves clarity.

4. Monthly Sheets in One File

Add multiple sheets in the same file for each month. Create a final sheet that adds totals from each.

Common Mistakes to Avoid in Excel Bookkeeping

Even if it’s simple, some errors can hurt your records. Watch out for:

• Skipping entries
• Using wrong category
• Not updating daily
• Wrong formulas
• Deleting rows by mistake
• Saving without backup

Build a habit of daily or weekly updates. Always double-check totals before closing.

Sample Layout for Bookkeeping Spreadsheet

Here’s how your basic sheet might look:

Date	Description	Category	Income	Expense	Mode	Notes
01/06/2025	Rent	Office	0	12000	Bank	Paid for June
02/06/2025	Client A	Sales	15000	0	UPI	Full payment
03/06/2025	Electricity	Utilities	0	3500	Card	Monthly bill

Add your own fields as needed.

Is Excel Good for Long-Term Bookkeeping?

Excel bookkeeping is fine for small businesses or solo owners. But as the business grows, you may need accounting software. Until then, Excel handles most needs.

For businesses that don’t need automation or cloud links, Excel bookkeeping gives good control.

If your business is new, this method saves cost and still gives you structure.

When Should You Move Beyond Excel?

You can stick to Excel until:

• Transactions cross 1000 per month
• You need invoice tracking
• You want automated tax reports
• You have employees
• You need to give access to others

If so, you may explore small business software later. But for now, Excel covers all basics.

Why Many Businesses Prefer Bookkeeping with Excel

Small business owners often choose this method because:

• It needs no training
• It fits all types of businesses
• You can customize anytime
• You control your own data
• It gives you quick reports
• It keeps things simple

These are solid reasons why bookkeeping in Excel is still common today.

Bookkeeping Excel Templates

Many free templates are available online. You can download them and change the fields as needed. But building your own from scratch is better. It lets you understand the format fully.

If you still prefer using templates, ensure they include key fields like:

• Date
• Description
• Income
• Expense
• Category
• Totals

You can then build on that base.

Need Help With Excel Bookkeeping?

If this feels like too much or you want someone else to manage it, you can hire bookkeeping services.

At Meru Accounting, we help businesses maintain accurate bookkeeping records using Excel. We understand how to do bookkeeping for small business in Excel. Our team has worked with different industries using clear and simple formats.

Our work is clean, structured, and cost-friendly. If you want to outsource the task while still using Excel, we provide reliable support.

Bookkeeping with Excel is simple, fast, and effective for small businesses. With a clear sheet and the right setup, you can get started in 10 minutes.

Use column headers, simple formulas, and daily updates. Keep your records clean. Check totals every month. With time, this habit will save you from mistakes and stress.

If you want to learn how to do bookkeeping in Excel, start with this method. It costs nothing and gives full control. For those wondering how to do bookkeeping for small business in Excel, this blog is the fastest way to begin.

Create your first bookkeeping spreadsheet today. Excel bookkeeping can work better than many expect.

FAQs

1. Can I use Excel for both personal and business bookkeeping?

Yes, Excel works well for both. You can create separate sheets or files to track personal expenses and business transactions. Just make sure to label them clearly and avoid mixing entries.

2. What Excel functions are useful for bookkeeping?

Useful functions include SUM, IF, VLOOKUP, TODAY, and TEXT. SUM helps add totals. IF can flag issues. VLOOKUP helps find values. These functions simplify checks and calculations.

3. How often should I update my Excel bookkeeping sheet?

Daily updates are ideal, but weekly is also fine if your transactions are limited. Regular updates help avoid missing or forgetting entries and ensure your data stays accurate.

4. Can Excel track unpaid invoices or bills?

Yes. You can add a column for “Payment Status” and mark entries as “Paid” or “Unpaid.” You can then use filters to view only unpaid ones or create a separate tab to track them.

5. How do I protect my Excel file from editing errors?

You can lock formula cells and protect the sheet using a password. This avoids accidental changes. Go to Review → Protect Sheet, and choose areas users can or cannot edit.

6. Is Excel bookkeeping acceptable for tax filing or audits?

Yes, as long as your data is complete, organized, and backed up. Keep digital and printed records if needed. Many tax professionals accept Excel files for small businesses with clear formatting.