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Books That Match What's On The Shelf
Inventory valued on a method you understand, cost of goods sold that ties to your counts, and margin reported by product line, so gross profit stops moving for reasons nobody can explain.
Retail Inventory Accounting In Michigan
Most retail books get sales right, because the register reports them. What goes wrong is the other half: what the goods cost, what is still in the back room, and what quietly walked out the door. When those numbers are loose, your profit is off by whatever the inventory is off by, and so is your tax return.
This engagement is part of our industry-specific accounting services, built for stores, showrooms and any business that buys or makes goods before it sells them. Manufacturers, wholesalers and distributors belong here too. They carry the same problem at a larger scale, with raw materials, work in progress and freight in transit.
- Inventory valuation and cost of goods sold that reconcile to your counts
- Margin reporting by product line or department
- A monthly inventory review, with the adjustments it needs
- Michigan sales tax filed and reconciled to the books
From Opening Count To Closed Month
How the work runs once the engagement letter is signed.
We Agree On What You Own Today
We start from your most recent count, test it against purchase records and agree an opening inventory balance with you. Every month after that builds from a figure you trust, not one inherited from a previous preparer.
We Choose A Costing Method In Plain Words
FIFO assumes the oldest stock sells first, which suits most retail and anything with a shelf life. Weighted average blends every purchase into one running cost, which suits goods bought in bulk at shifting prices. We recommend one, explain why, and apply it the same way every month.
We Build The Books Around Your Departments
Through chart of accounts setup in QuickBooks Online, sales and cost of goods sold break out by product line or department. That structure is what makes margin reporting possible, so we get it right before the first close.
We Review Inventory Every Month
Each close, we compare the books to your counts or cycle counts, record shrink and write-downs, catch vendor invoices that landed in the wrong month, and move freight-in into cost of goods sold where it belongs. Margin by department arrives with your statements.
We File Sales Tax From The Same Books
Our Michigan sales tax filing reconciles what the register collected to what the return reports, every period. The tax and the books stay in agreement, so a notice is far less likely to come with a surprise balance.
Shrink Is A Number, Not A Feeling
Every store loses some stock to theft, damage, spoilage and receiving mistakes. The trouble starts when that loss is never measured and simply shows up as a thinner profit at year end. We record shrink on its own line whenever counts come through, so you can see how big it is and whether it is growing.
Inventory Questions Owners Bring To Us
Can we change the costing method we have been using?
Often, yes, but for tax purposes it is a formal change in accounting method, usually requested on IRS Form 3115, and it has to be handled in the right year. We look at what you use now, what it is costing you and whether a change is worth the paperwork before we recommend anything.
Do you work with manufacturers and distributors, or only stores?
Both. Manufacturers carry raw materials, work in progress and finished goods, and the cost of labor and overhead has to follow the product. Wholesalers and distributors deal with landed cost, freight and volume rebates. The principle is the same as retail: the balance sheet should match what is physically on hand, and margin should be visible by line.
How often should we count inventory?
Most businesses count everything at least once a year, and that count anchors everything else. Many add cycle counts, a few sections each month, which catches problems sooner and makes the full count faster. We build the monthly review around the routine you actually run and tell you plainly if it is leaving gaps.
Does anyone from your team need to be at the store?
No. We are a virtual firm, so counts, reports and the monthly review move by secure file exchange, email, phone and video, wherever the store happens to be, in Michigan or out of state. Your team does the counting, and we handle everything that happens after the clipboard is put down.
Services That Work Alongside Inventory Accounting
Food and beverage cost, prime cost, tips and weekly flash numbers for restaurants, cafes and grocery stores.
Restaurant and food service accounting in detail Sales Tax Filing & ComplianceMichigan sales tax calculated, filed and reconciled to the books, with the reporting retailers deal with every period.
Sales Tax filing and compliance in detail Chart Of Accounts SetupAn account structure with the product, department or location detail you need to see margin clearly.
Chart of accounts setup in detail Specialized / Industry-Specific OverviewRetail, inventory and food service accounting, with the industries we know best laid out side by side.
Return to Specialized and Industry-SpecificGet A Gross Margin You Can Actually Trust
Tell us what you sell and how you count it. We will look at where your inventory stands and tell you plainly what it takes to get the books and the shelves in agreement.