CPA explains how to stop dreading and start understanding how cost of goods sold actually works!

I received similar questions about inventory and cost of goods sold almost every day during this past tax season, and every day I told myself "I need to make a video on this!" Well this is the video! I discuss the accrual method for inventory vs cash method for inventory, how they work, and how they can be presented on the tax forms.

COGS tracking spreadsheets: https://notyourdadscpa.com/inventory-...

COGS formula sheet (used in video): https://docs.google.com/spreadsheets/...

1) SUBSCRIBE to learn how to get a handle on your business!
   / @notyourdadscpa  

2) FREE GUIDE: "Business Starter Guide for Resellers"
https://notyourdadscpa.com/business-s...

3) COME JOIN THE FREE GROUP!
Accounting for Online Sellers free Facebook group:   / accountingforsellers  

4) READY TO DITCH THE TAX ANXIETY?
Reseller Tax Academy: https://www.resellertaxacademy.com/
Bookkeeping Basics for Resellers: https://notyourdadscpa.com/bookkeepin...
Reseller Finance eBook: https://notyourdadscpa.com/reseller-f...

5) LET'S CONNECT!
Follow for tips on Instagram!   / notyourdadscpa  
Facebook:   / notyourdadscpa  
Website: https://www.notyourdadscpa.com

6) NEED TAX HELP? Join my signup list here:
https://notyourdadscpa.com/tax-season/

TIMESTAMPS

0:00 - Introduction
0:35 - Historical method of inventory deduction (accrual method) and its changes
0:57 - Explanation of the cash method for inventory
1:15 - Overview of how to calculate cost of goods sold and its presentation on tax forms
1:47 - Beginning inventory
2:29 - Ending inventory
2:37 - Basic formula for cost of goods sold
2:58 - Detailed example of the accrual method
4:00 - Direct tracking of cost of goods sold and its pros and cons
4:23 - Using a free spreadsheet for tracking cost of goods sold
4:36 - Adjusting tax forms based on direct tracking
5:07 - Determining missing inventory figures with known cost of goods sold
6:00 - Adjusting tax forms when purchases are known but ending inventory is not
6:21 - Shortcut method for the accrual method
7:00 - Example of the lazy accountant method
8:01 - Differentiating between accrual and cash methods for inventory
8:37 - Accounting method selection on tax forms
9:10 - Cash method for inventory and how it impacts tax returns
9:49 - Summary and other resources