You sold 5,000 units, which cost your business $30,000 (according to the weighted average method). Divide your total revenue by your markup percentage, and subtract the new sum from your calculated cost. If you produce all the clothing you sell in-house, you might add the cost of raw materials and equipment acquisition/maintenance.

We found that ZarMoney punches above its weight in terms of inventory features, with the ability to manage products at multiple locations, easily transfer inventory and assign barcodes. E-commerce business owners will like that FreshBooks integrates with more than 80 third-party business apps. Paid plans range from $17 per month for the entry-level Lite version to $55 per month for the Premium tier. The right multichannel inventory sync tool will be a hub for all your sales channels and bookkeeping and accounting software. Your bookkeeper might also prepare other auxiliary reports for your business, like accounts payable and accounts receivable aging reports.

How to track inventory in ecommerce bookkeeping

Harnessing the power of automation here allows you to pull the data directly from your platforms into your books on a real-time basis. If you offer gift cards, a typical sale means someone pays you, and you give them a gift card at that moment. That cash inflow gets recognized ecommerce bookkeeping as unearned revenue in your books because you haven’t exchanged any goods yet. When the gift card is redeemed, you can recognize the unearned revenue on your income statement. Most of the payments you receive will be through customer credit cards versus other forms of payment.

Companies like Intuit bundle their accounting services with other business software, so taking advantage of these deals could save you some money. Some accounting software providers charge for additional users beyond a set limit, which is an important point to keep in mind if many employees need access. A few vendors also offer bundles or add-ons, including timekeeping and payroll, for an additional monthly fee. Another tip that can make bookkeeping for ecommerce relatively easy is using an e-commerce automation tool that can aid in automatically tracking expenses and fees across all your sales channels. E-commerce businesses must proactively establish best practices for bookkeeping to ensure long-term profitability and growth.

What is ecommerce accounting?

This extremely helpful document keeps track of cash and cash equivalents coming into your online store and going out, too. As an ecommerce entrepreneur, you’re going to come face-to-face with payroll duties and payroll taxes. When it comes to hiring a bookkeeper, you can hire one in-house as a full-time employee, use a freelance bookkeeper, or work with a third-party bookkeeping service, like Bean Ninjas. If a business doesn’t have sufficient money in their bank account, there’s going to be problems.

Financial statements provide a snapshot of your company’s revenue, expenses, profitability, and debt and are an integral part of ecommerce bookkeeping. One way to report sales tax in your bookkeeping records is to debit the amount you’ve collected from your cash account and credit it to your sales revenue and sales tax payable accounts. It’s important to track sales tax correctly in your chart of accounts, so it’s clear how much of your cash in the bank should be set aside for taxes.