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-tracking-spreadsheets/ COGS formula sheet (used in video): https://docs.google.com/spreadsheets/d/173YmTM312h7fkYowOl0R-QIidtoI1o2gu575nPxnPwY/copy 1) SUBSCRIBE to learn how to get a handle on your business! https://www.youtube.com/channel/UCV9ns78ekwpojACIGmXXDnw?sub_confirmation=1 2) FREE GUIDE: "Business Starter Guide for Resellers" https://notyourdadscpa.com/business-starter-guide-for-resellers/ 3) COME JOIN THE FREE GROUP! Accounting for Online Sellers free Facebook group: https://www.facebook.com/groups/accountingforsellers/ 4) READY TO DITCH THE TAX ANXIETY? Reseller Tax Academy: https://www.resellertaxacademy.com/ Bookkeeping Basics for Resellers: https://notyourdadscpa.com/bookkeepingforresellers/ Reseller Finance eBook: https://notyourdadscpa.com/reseller-finance/ 5) LET'S CONNECT! Follow for tips on Instagram! https://www.instagram.com/notyourdadscpa/ Facebook: https://www.facebook.com/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