Nugent & Associates provides a complete outsourced ecommerce accounting service for your BigCommerce
business.
- Ecommerce consulting – ongoing business, technical, and process optimization guidance
- Setup of integrated cloud accounting, cloud inventory, sales tax, and supporting tools
- Sales tax registration and filing
- Daily bookkeeping
- Ecommerce Controller service
Running an internet-based business has its own set of issues compared to managing a business with
physical locations. First, there are many different types of ecommerce businesses: e-tailers
serving consumers, online businesses, internet marketers, business-to-business internet companies,
membership-based sites, businesses supported by advertising revenue, bloggers, ecommerce websites,
affiliate marketers, and domain flippers, to name a few.
Our Shopify Training Highlights:
-
Adding products and product information
-
Selecting a theme for your Shopify store
-
Customizing menus
-
Setting up shipping
-
Collecting payments online
-
Configuring taxes
-
Installing Shopify apps
-
Managing orders, inventory, and sales from the dashboard
Launching your store
Shopify itself will provide you with tracking for your sales, discounts and refunds of course. However, this
is limited and lacks detailed information for your accountant to use such as cost of goods sold to be
determined for record’s sake.
Why is Knowing Cost of Goods Sold Important?
Cost of goods sold (COGS) is another financial metric that can be difficult to wrap your head around. But
there's no need to get swamped by all the figures and financial jargon.
It may be a pain at first, but stick at it. When everything clicks into place, your business becomes much
smarter by all accounts.
Get on top of this important metric, and you can find ways to make more money — without gaining any more
customers.
That’s how powerful good accounting practices are. It is why big enterprises spend colossal amounts on
accountants and legal advisers.
Your small manufacturing business doesn’t have to get left behind. Everything is under your control. We’re
here to show you there is a quick and easy solution designed for small businesses.
Cost of goods sold is one of the vital cogs in your manufacturing business. It may be tempting to ignore or
overlook it — this is not only bad practice, but bad for your margins.
What is Cost of Goods Sold?
In short, cost of goods sold is how much it costs your business to sell inventory over a given period of
time. This could be monthly, quarterly, or yearly. You could calculate COGS every month, and also do a
quarterly review to make sure everything lines up. Other businesses may only do this quarterly.
It's up to each business owner to figure out what is best for their needs. In any case, the basic principles
stay the same.
COGS is a method of giving a real-world valuation to your inventory. It’s a must-know for proper inventory
management. Your
material and labor expenses could fluctuate from month to month. It pays to keep up with the price of
getting your goods to market.
COGS tells you how much you spend to turn your raw materials into sold products.
It is useful in two main ways:
It gives you important information about your business’ expenditure; and
It is necessary to produce accurate tax statements, which shows your taxable income.
In the US, small businesses are routinely subject to tax audits. The IRS makes sure they are reporting their
income accurately. This means that COGS is serious business.
Calculating cost of goods sold is vital to know your taxable income. Other metrics like leftover stock can
also be taxable, so you need be on top of everything.
The accurate calculation and reporting of COGS is necessary under GAAP (Generally Accepted Accounting
Principles).
We will go through how to calculate cost of goods sold from a manufacturing perspective.
