#inventory
Inventory tracking, valuation, and management for businesses
COGS is beginning inventory plus purchases and direct labor minus ending inventory — under IRS rules a $5,000 miscount moves gross profit $5,000.
LIFO matches newest costs against sales, cutting taxable income while prices rise — but the IRS locks in the election and taxes the reserve when you leave.
Duties and freight are inventory cost, not expenses — capitalize them per SKU, reconcile payouts gross-to-net, and accrue uninvoiced fulfillment monthly.
FIFO maximizes reported profit when costs rise, LIFO minimizes tax, average cost splits the difference — choose by cash flow, borrowing plans, and IRS rules.
Freight-in is part of inventory cost and becomes COGS when goods sell; freight-out is a selling expense. Mixing them distorts gross margin and tax.
COGS equals beginning inventory plus purchases minus ending inventory — two careful counts decide your gross profit, pricing, and tax.
Shopify labels bill separately from payouts — split each invoice, book postage to COGS, and remit sales tax collected on shipping.
Reconcile bank accounts, receivables, payables, payroll, and inventory before December 31 — plus the W-9s, 1099s, and IRS deadlines that close with the year.
Etsy fees are not COGS — they are Schedule C selling expenses. Track materials, labor, fees, and shipping per listing to price for real profit.
inFlow's Xero update syncs payments both ways, carries tracking tags into Xero, and maps payment methods to accounts — ending double-entry.
Profit books invoiced revenue before cash arrives while loan principal, inventory, and draws drain cash invisibly — find the leak on your cash flow statement.
CCC equals DIO plus DSO minus DPO — top performers run a 39-day cash conversion cycle versus 63 at the bottom. Collect faster, hold less, pay smarter.
