Author Topic: Correct expense placement  (Read 5041 times)

jzahn131415

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Correct expense placement
« on: April 17, 2020, 09:08:07 am »
Good morning!
  I sell comic books and I was wondering if anyone would like to weigh in on how i should list the expense of inventory.  Currently I have each book figured up on how much they cost comparative to how much i spent on the collection.  So I spent $5 on 5 books i put $1.00 in my item cost line for cost of goods.  Any benefit or negative to putting the whole $5 cost into expenses for that single month instead of putting it into cog as they sell?  some books can take months to sell, some take a day or two.  Just curious.

Thanks!

Scott

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Re: Correct expense placement
« Reply #1 on: April 17, 2020, 12:44:31 pm »
For your own personal preference you could do it either way, however this gets into accounting principals when you use the information for tax purposes.  There are certain rules for how inventory on hand vs sold inventory is handled.
So, consult your tax professional as they may prefer you to do it by each item... (I am not a tax professional in case you couldnt tell)
« Last Edit: April 18, 2020, 04:01:10 pm by Scott »