Gross receipts
Gross receipts are the income you receive from your business. You should keep supporting documents that show the amounts and sources of your gross receipts. Documents that show gross receipts include the following:

1. Cash register tapes
2. Bank deposit slips
3. Receipt books
4. Invoices
5. Credit card charge slips
6. Forms 1099-MISC

Purchases
Purchases are the items you buy and resell to customers. If you are a manufacturer or producer, this includes the cost of all raw materials or parts purchased for manufacture into finished products. Your supporting documents should show the amount paid and that the amount was for purchases. Documents for purchases include the following:

1. Cancelled checks
2. Cash register tape receipts
3. Credit card sales slips
4. Invoices

Expenses
Expenses are the costs you incur (other than purchases) to carry on your business. Your supporting documents should show the amount paid and that the amount was for a business expense. Documents for expenses include:

1. Cancelled checks
2. Cash register tapes
3. Account statements
4. Credit card sales slips
5. Invoices
6. Petty cash slips for small cash payments

Assets
Assets are the property, such as machinery and furniture you own and use in your business. You must keep records to verify certain information about your business assets. You need records to figure the annual depreciation and the gain or loss when you sell the assets. Your records should show the following information:

1. When and how you acquired the asset.
2. Purchase price.
3. Cost of any improvements.
4. Deductions taken for depreciation and casualty losses.
5. How you used the asset.
6. When and how you disposed of the asset, including selling price and expenses of sale.

The following documents may show this information:

1. Purchase and sales invoices.
2. Real estate closing statements.
3. Cancelled checks.