Inventory

I hope that 2017 is off to a good start for everyone. Of course with the new year comes thoughts of taxes.

To hopefully make tax time just a little easier, I wanted to give a quick reminder for those of you who keep inventory. If you have items you sell at retail or wholesale, you probably will not have bare shelves at the end of the year, which means you are supposed to count your inventory. I recommend that you make a list of all your items and their unit cost. Then just count the number you have in stock and multiply.

Note that most businesses use the cost, not the selling price. That is, you want to know how much cost you have in each item, not the amount you expect to get when you sell each one.

Besides resale items, you should also count your supplies. Everyone has some supplies on hand at the end of the year, even people who are in a service business without regular resale products. Do the calculation the same way: item description, number on hand, cost, and multiply the number and the cost per item.

As usual, let us know if you have any questions. And in the meantime, have a happy new year!

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