Two ways to track the cost of your stock

Until you track the cost of your stock, your profit is reported before the cost of the things you sold, so it reads high. There are two ways to fix that, and you choose in Ledger › Setup under How you track the cost of stock.

Count my stock and record what it is worth

The one most small businesses and every accountant already use. You count your shelves once a quarter or once a year, record what the stock cost you, and TALISK_HQ moves the difference to cost of goods sold in one entry.

It works from day one. There is nothing to set up per product, so a shop with hundreds of items can start this afternoon. The trade is timing: your cost of goods is right as at each count, not after every single sale.

Most sellers should start here.

Track cost of goods sold from Shopify product costs

TALISK_HQ books the cost of each sale as the payout posts, using the Cost per item on your Shopify products. Your margin is right continuously rather than at each count.

The trade is data entry: every product you sell needs a cost. Orders with a product that has no cost are held out entirely rather than guessed, so a partly costed catalogue gives you a partly costed picture until you fill the gaps.

This one is Shopify only.

You can run both

They are not rivals. The product costs keep your margin current between counts, and a count trues the whole book up to what is really on the shelves. If you run both, code purchases to your stock account and let each do its half.

What changes once either is on

Code stock purchases to your inventory account rather than to an expense account. Mark that account first in Ledger › Accounting › Chart of Accounts with the Stock button; TALISK_HQ never guesses which account holds your stock, because an imported chart keeps it wherever the accountant put it.

If you already hold stock, post its value once so your books start from the truth: debit your stock account, credit the account you originally expensed it to. Books Health tells you if that account ever goes below zero, which is the usual sign that purchases are still being expensed.