by XpertBooks Pro Team | Last updated Sep 30, 2026 | Accounting & Bookkeeping
Good restaurant bookkeeping comes down to daily sales reconciliation, tracking food and labor costs separately, handling tips and payroll correctly, and watching your prime costs weekly. Restaurants that reconcile their POS against deposits every day catch theft, errors, and cash leaks before they snowball.
Saturday night. Your dining room is packed, the bar is three deep, and the register says you did $8,400. Monday morning, your bank deposit shows $7,950. Where did $450 go?
Comps? Voids? A server who "forgot" to ring in a few cash tables? Credit card fees you didn't account for? In a restaurant, the gap between what the POS says and what lands in the bank is where profits quietly disappear. And most owners never track it closely enough to know.
Restaurant bookkeeping isn't harder than other industries — it's just faster. Money moves every single day, in cash and cards and tips and comps, and if you don't have a daily rhythm for capturing it, you're flying blind. Here's how to get it right.
Reconcile daily sales — every single day
This is the non-negotiable habit. Once a day, someone (not the person who closed the register) should:
- Pull the POS sales report for the day: gross sales, broken down by cash, credit card, gift card, and comps/voids/discounts.
- Compare it against the actual deposit — cash counted plus card batches settled.
- Account for the difference. Credit card processing fees (usually 2–3%) explain part of it. Cash over/short explains more of it than most owners want to admit.
Say your POS shows $8,400: $5,000 in cards, $3,000 cash, $400 in comps. Your card batch settles at $4,850 (after $150 in fees) and your cash drawer counts $2,980. Now you can explain the full $8,400 — $4,850 net cards, $2,980 cash, $150 fees, $400 comps, $20 cash short. Every dollar accounted for. That's the goal.
Enter the day's sales as a sales receipt in QuickBooks Desktop (money's already in hand — no invoice needed), deposited to Undeposited Funds and then grouped into your bank deposit.
Track food cost like your margin depends on it (it does)
Food cost percentage — food purchases divided by food sales — is the number that makes or breaks restaurants. Most full-service restaurants target 28–35%. If yours is running 42%, you're either over-portioning, wasting product, over-ordering, or losing inventory somewhere.
What actually works:
- Do weekly inventory counts on your high-cost items — proteins, liquor, dairy. A full count monthly, spot counts weekly. It takes 30 minutes and it's the single best theft and waste detector you have.
- Separate food and beverage purchases in your chart of accounts. "Food purchases" and "beverage purchases" as separate expense accounts, minimum. If you can't see beverage cost apart from food cost, you can't fix either one.
- Price your menu with real numbers. That $24 entrée needs to cost you $7–$8 in ingredients, not $11. Recipe costing — even a rough version on a spreadsheet — beats guessing.
Labor cost and the tip reporting trap
Labor is your other giant cost, and restaurants have quirks most businesses don't:
- Tips are not your expense, but you still have to report them. Credit card tips flow through your payroll — they're employee income, subject to withholding, reported on W-2s. Cash tips are the employee's responsibility to report to you, and yours to include in payroll tax calculations once reported. This is an area where "we'll figure it out at year-end" gets expensive fast.
- Track labor cost percentage separately from food cost. Together they're your prime costs — the number one metric in the industry. Healthy full-service restaurants run prime costs around 60–65% of sales. Above 70%? Something has to give: prices, portions, scheduling, or staffing.
- Overtime sneaks up. In a business with split shifts and call-ins, employees drift into overtime without anyone noticing until payroll runs. Review hours mid-week, not after the fact.
Payroll in restaurants is genuinely tricky — tip credits, multiple pay rates, minors' hour restrictions. If payroll errors keep happening, it's worth understanding the common failure points.
Don't forget sales tax on the right things
Sales tax rules for restaurants vary by state and get surprisingly specific: dine-in vs. takeout can be taxed differently, catering has its own rules, and some states tax soda but not groceries. Make sure your POS is configured with the right tax rates for each order type — fixing it in the books afterward is miserable.
Remit on time, every time. States are notably unforgiving about late sales tax payments, and the penalties stack up fast.
Manage supplier bills before they manage you
Restaurants juggle a lot of vendors — produce, meat, dairy, broadline distributors, linen, chemicals. Bills arrive daily, terms are short, and it's easy to lose track.
- Enter bills when they arrive, not when you feel like paying them. You can't manage cash flow against bills you haven't recorded.
- Take the early-payment discounts when the math works, but don't starve your cash reserves to save 1%.
- Watch for price creep. When your broadline distributor quietly raises chicken prices 8% over two months, your menu prices need to follow — but only if you're watching.
Watch these numbers weekly
You don't need a finance degree. You need five numbers, every week:
1. Prime costs (food + labor as % of sales) — the health check.
2. Cash over/short — the honesty check.
3. Food cost % — the waste and theft check.
4. Average ticket / covers — the demand check.
5. Bank balance vs. books — the "is everything actually recorded" check.
Owners who review these five numbers weekly catch problems in days. Owners who wait for the accountant's quarterly report catch them in months. The difference is real money.
If your business also handles client deposits or advance payments — common in catering and private events — the same discipline around tracking deposits separately applies.
Conclusion!
That brings us to the end of this guide on restaurant bookkeeping. We hope the tips explained above helped you set up a daily rhythm for sales, costs, and payroll that actually protects your margins. If you run into any difficulty applying them, consider consulting a qualified and experienced QuickBooks professional for further assistance.
FAQs
Should I enter every day's sales separately in QuickBooks?
Yes — one sales receipt per day, matching your POS daily report. Lumping a week together makes it impossible to investigate a specific day's discrepancy later.
How do I record credit card fees?
Record gross sales in full, then record processing fees as a separate expense (merchant account fees). Don't net them against sales — you'll understate both revenue and expenses, and your sales tax calculations can go sideways.
Cash tips vs. credit card tips — what's the bookkeeping difference?
Credit card tips pass through your payroll system: you collect them from the card batch and pay them out to staff, with tax withholding. Cash tips are reported by employees to you, and you include reported amounts in payroll tax filings. Both end up on the employee's W-2.
What's a good food cost percentage?
Typically 28–35% for full-service restaurants, lower (20–28%) for quick service. But the "right" number depends on your concept, pricing, and market — the important thing is knowing yours and watching it move.
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by XpertBooks Pro Team | Last updated Sep 30, 2026 | QuickBooks
In QuickBooks Desktop, go to Customers > Create Statements, set your statement date and period, choose which customers to include, and click Print or E-mail. Pick the statement type — Balance Forward, Open Item, or Transaction Statement — based on how much detail your customer needs.
Here's a scenario every business owner knows: a customer calls and says, "I don't think I owe that much." You've sent the invoices. They've made some payments, maybe missed one, maybe paid the wrong invoice number. Now you're both staring at different numbers.
That's exactly what customer statements are for. An invoice says "pay this one thing." A statement says "here's your whole account — every invoice, every payment, every credit — and here's what you still owe." It ends the argument before it starts.
Let's walk through creating them in QuickBooks Desktop, plus the statement-type choice that trips people up.
What are the three statement types?
This is the first decision QuickBooks asks you to make, and it matters more than people think:
- Balance Forward: Shows the customer's previous balance, then the invoices and payments that contributed to the current balance for the date range. Best for customers with regular ongoing activity — it reads like an account summary.
- Open Item: Shows only open (unpaid) invoices from the last 365 days. Best for collections — it keeps the focus on what's still owed, without the noise of paid history.
- Transaction Statement: Shows every transaction in a specific date range. Best when a customer wants the full picture and asks, "show me everything."
When in doubt for a payment reminder? Open Item. It answers the only question that matters: what do you still owe me?
Before you start
- Make sure the customer's invoices and payments are entered and up to date. A statement generated from incomplete data will just create a second argument.
- Check that you have email addresses on file if you plan to email statements. Sounds basic — but it's the number one reason batch emailing fails.
How to create customer statements, step by step
Step 1: Open the Create Statements window
- Go to the Customers menu at the top.
- Click Create Statements.
- The window opens with your statement options all in one place.
Step 2: Choose the statement type and date
- Under Select Statement Type, pick Balance Forward, Open Item, or Transaction Statement (see the guide above if you're unsure).
- Enter the Statement Date — usually today's date or your month-end date.
- Set the Statement Period. You can pick a date range, or choose All open transactions as of Statement Date to catch everything unpaid regardless of when it was invoiced.
One tip: for month-end statements, use the last day of the month as your statement date. It keeps your statements consistent and makes them easy to match against your aging reports.
Step 3: Select your customers
- Under Select Customers, choose who gets a statement: one customer, all customers, customers with open balances, or a filtered group.
- Sending to everyone wastes paper and annoys customers with zero balances. Most businesses pick customers with open balances for routine statements.
Step 4: Set your additional options
- In the Additional Options section, decide what shows on the statement.
- Want invoice PO numbers visible? Check Print PO numbers on transactions — your customers will thank you, since it helps their AP department match your statement to their records.
- You can also choose whether to show aging information, which is handy for past-due reminders.
Step 5: Preview, then print or email
- Click Preview to check what the customer will actually see. Look at it with fresh eyes — does the balance make sense? Is anything missing?
- Then click Print to mail physical copies, or E-mail to send them digitally.
- If you email, QuickBooks sends each customer only their own statement. Nobody sees anyone else's numbers.
When should you send statements?
Most businesses send them monthly, right after month-end close. Some send them only to past-due customers as a collections tool. Either way, consistency matters — a customer who gets statements every month takes them seriously. A customer who gets one out of nowhere after six months of silence assumes you're desperate.
A good rhythm: invoices go out when the work is done, statements go out monthly as reminders, and phone calls happen when an account hits 45–60 days past due.
Common mistakes to avoid
- Generating statements before entering all payments. If last week's check hasn't been recorded yet, the statement shows a balance the customer already paid. That's how "I already paid that!" arguments start.
- Using the wrong statement date. A statement date in the future or an odd mid-month date confuses customers and makes your statements hard to reconcile with your aging report.
- Emailing statements with missing or wrong email addresses. QuickBooks will happily send them into the void. Verify email addresses in your customer records first — especially for customers who "never got the statement."
- Sending statements to zero-balance customers. It trains customers to ignore your statements. Filter for open balances and keep the list relevant.
Conclusion!
That brings us to the end of this guide on how to create customer statements in QuickBooks Desktop. We hope the steps explained above helped you generate clear, accurate statements and get paid faster. If you run into any difficulty while following the steps, consider consulting a qualified and experienced QuickBooks professional for further assistance.
FAQs
What's the difference between an invoice and a customer statement?
An invoice asks for payment on one specific sale. A statement summarizes the customer's whole account — all invoices, payments, and credits — and shows the total amount owed. You send invoices to bill; you send statements to remind.
Which statement type should I use for collections?
Open Item. It lists only the unpaid invoices, so the customer sees exactly what they owe without digging through paid history.
Can I email statements to multiple customers at once?
Yes. Select your customers in the Create Statements window and click E-mail — QuickBooks sends each customer their own individual statement.
Why doesn't a payment show up on my customer's statement?
Most likely the payment was entered after you set the statement date, or it was deposited without being linked to the customer through Receive Payments. Enter customer payments via Customers > Receive Payments so they connect to the right account.
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by XpertBooks Pro Team | Last updated Sep 30, 2026 | Accounting & Bookkeeping
Accounting for wholesalers revolves around inventory: valuing it correctly, tracking landed costs (freight, duties, warehousing), and keeping cost of goods sold accurate. Distributors who nail inventory accounting, watch margins per product line, and stay on top of receivables run leaner and spot problems faster.
Picture this. You sell a pallet of paper towels for $2,400. Sounds great — until you realize the freight cost you, the warehouse space cost you, three units got damaged in transit, and your supplier's "volume rebate" still hasn't shown up in your books. Was that pallet actually profitable?
For wholesalers and distributors, the sale is the easy part. The hard part is knowing what it really cost you to make that sale. Your margins are thinner than a retailer's, your inventory is your biggest asset, and small bookkeeping mistakes multiply fast when you're moving volume.
This guide covers the accounting practices that actually matter in wholesale and distribution — the stuff that separates distributors who know their numbers from ones who just hope the bank balance works out.
Your inventory is your balance sheet
For most distributors, inventory is the single largest asset on the books. If it's wrong, everything downstream is wrong: cost of goods sold, gross profit, taxes, even your borrowing capacity if you have a line of credit secured by inventory.
Three things to get right:
1. Pick an inventory valuation method — and stick with it
QuickBooks Desktop supports average cost by default, and QuickBooks Enterprise supports FIFO as well. The method you choose changes your reported profit, especially when supplier prices move around.
- Average cost: Every unit in stock carries the same blended cost. Simple, smooth, and fine for most distributors with stable pricing.
- FIFO (first in, first out): The oldest units are assumed to sell first. In a rising-price environment, FIFO shows lower cost of goods sold and higher profit — which also means a bigger tax bill.
Switching methods mid-stream makes your year-over-year comparisons meaningless, so pick one deliberately (your accountant can help) and stay consistent.
2. Track landed cost, not just purchase price
That $2,400 pallet of paper towels? The invoice said $1,800. But you also paid $220 in freight, $95 in import duties, and it sat in your warehouse for six weeks. Your true cost isn't $1,800 — it's closer to $2,150 before you even factor in labor to receive and store it.
Distributors who only track the invoice price chronically understate their costs and overstate their margins. Record freight, duties, insurance, and handling against the inventory items they belong to, not as generic expenses. That way your cost of goods sold reflects reality when the item sells.
3. Count it. Regularly.
Cycle counts beat annual counts every time. Pick a section of your warehouse each week and count it. Catching a discrepancy early — a receiving error, damage, or yes, shrinkage — is worth far more than discovering it during an annual count when the trail is cold.
Know your margin per product line, not just overall
Your business might show a healthy 22% gross margin overall while two of your eight product lines quietly lose money. That's the danger of only watching the big number.
Run a profit-and-loss by product line or item category every month. In QuickBooks Desktop, item-based tracking gives you this — but only if your items are set up with enough detail. "Miscellaneous hardware" as one item tells you nothing. Break it down to a level where the numbers can actually guide a decision: keep the line, renegotiate with the supplier, or drop it.
And watch the math on volume discounts you *give* customers versus rebates you *get* from suppliers. A 5% customer discount on thin margins can wipe out a quarter's profit on that account if you're not tracking it separately.
Vendor rebates and credits: the silent profit killer
Supplier rebates are great — until they sit unrecorded for months and nobody follows up. If your supplier owes you a 2% quarterly volume rebate, that's real money, and it belongs on your books as a receivable (or as a reduction of inventory cost, depending on how your accountant treats it).
Practical habits:
- Log expected rebates when you qualify for them, not when the check arrives.
- Keep a simple schedule: which supplier, what terms, what's owed, what quarter.
- Follow up before the supplier's claim deadline passes. Missed deadlines are pure lost profit.
Receivables: your second-biggest risk
Wholesalers sell on terms — net 30, net 60, sometimes net 90. That means you're effectively lending money to your customers, interest-free, while your own suppliers want paying in 30 days. That gap is where cash flow goes to die.
What works:
- Run an A/R aging report weekly. Not monthly. Weekly. Customers in the 60+ day bucket need a phone call, not another statement.
- Set credit limits and enforce them. QuickBooks Desktop lets you set credit limits per customer. A customer who's $40,000 past due shouldn't be placing new orders on terms.
- Consider early-payment discounts carefully. "2/10 net 30" (2% off if paid within 10 days) accelerates cash flow, but do the math — 2% for 20 days early is roughly a 36% annualized cost. Sometimes a short-term line of credit is cheaper than the discount you're giving away.
When you outgrow basic inventory tracking
If you're managing multiple warehouses, lot or serial numbers, or barcoding, QuickBooks Desktop Pro and Premier start to feel cramped. That's what QuickBooks Enterprise's Advanced Inventory is built for: multiple inventory sites, bin location tracking, barcode scanning, and FIFO costing.
Upgrading isn't about prestige — it's about the point where spreadsheet workarounds cost more in staff time than the software costs. If your team is tracking warehouse locations in Excel alongside QuickBooks, you've hit that point.
Build bookkeeping habits that scale
Distribution businesses live or die on process. A few fundamentals borrowed from businesses that manage complex job costs translate well here:
- Reconcile bank and credit card accounts monthly, without exception.
- Separate purchasing, receiving, and bill-paying duties as you grow — one person doing all three is how errors (and worse) hide.
- Review your financial statements monthly, not just at tax time. A distributor who reads their P&L monthly catches margin erosion in March instead of December.
Conclusion!
That brings us to the end of this guide on accounting for wholesalers and distributors. We hope the tips explained above helped you see where your true costs hide and how to keep your inventory, margins, and receivables under control. If you run into any difficulty applying them, consider consulting a qualified and experienced QuickBooks professional for further assistance.
FAQs
What's the biggest bookkeeping mistake wholesalers make?
Understating true product cost. Recording only the supplier's invoice price — and expensing freight, duties, and warehousing separately — makes margins look better than they are and leads to underpricing.
Should a small distributor use FIFO or average cost?
For most small distributors, average cost is simpler and perfectly adequate. FIFO makes sense when you deal with perishable goods or significant price swings and need more precise cost matching. Talk to your accountant before switching.
How do I account for damaged or obsolete inventory?
Write it down to its net realizable value (what you can actually sell it for, if anything) and record the loss. Don't leave dead stock sitting at full cost on your balance sheet — it inflates your assets and hides the problem.
How often should a distributor reconcile inventory?
Cycle-count a portion of your warehouse weekly so every SKU gets counted at least quarterly, and do a full physical count at least once a year. The weekly habit catches problems while they're still fixable.
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by XpertBooks Pro Team | Last updated Sep 30, 2026 | QuickBooks
To print checks in QuickBooks Desktop, go to File > Print Forms > Checks, pick the bank account, confirm the starting check number, and print. Before your first run, set up the printer once under File > Printer Setup — and if the printed text doesn't line up with your check stock, the Align button in that same window fixes it.
It's Friday at 4:30 PM. You've got a stack of vendor payments to get out — or worse, payroll — and the first check comes out of the printer with the payee name spilling over the memo line and the dollar amount floating half an inch too high. Nine more checks to go.
Deep breath. This is one of the most common QuickBooks Desktop frustrations, and it's almost always a setup issue, not a printer problem. Once your check style and alignment are dialed in, printing checks becomes a two-minute job.
Here's the whole process, from first-time setup to fixing crooked printing.
Before you start: what you'll need
- QuickBooks-compatible check stock. Don't grab plain paper and hope for the best. You need actual checks that match one of QuickBooks' three styles: Voucher, Standard, or Wallet. Voucher checks (the ones with two stubs at the top) are the most popular for businesses, since the stub keeps a record of what the check paid for.
- A working printer with fresh ink or toner. Alignment problems often trace back to a printer that's low on toner or needs cleaning. Not always — but worth ruling out first.
- Your check numbers. QuickBooks asks for the starting check number before printing, so know which physical check is sitting at the top of your printer tray.
Step 1: Set up your printer for checks
You only do this once — unless you switch printers or check stock.
- Go to File in the top menu, then Printer Setup.
- In the Form Name dropdown, select Check/Paycheck.
- Under Check Style, pick the radio button that matches your check stock: Voucher, Standard, or Wallet.
- Under Printer Name, choose the printer you'll use for checks. If you have a dedicated check printer, select it here.
- Click OK to save.
That handles the basics. The alignment fix lives here too — we'll come back to it in Step 4.
Step 2: Write your checks (and queue them up)
You can print checks one at a time or in a batch. Batching is the sane option.
- Go to Banking, then Write Checks (you can also press Ctrl+W).
- Choose the bank account the checks should come from.
- Fill in the payee, date, amount, and expense accounts like normal.
- Here's the key: check the Print Later box at the top of the Write Checks window. The check number field changes to say "To Print," and the check goes into your print queue.
- Save the check and repeat for the rest.
Writing the checks first and printing them all at once beats printing one-by-one every time. Less fiddling with the printer tray, fewer chances to load the wrong check stock.
Step 3: Print the batch
- Go to File > Print Forms > Checks.
- Select the bank account.
- QuickBooks asks for the starting check number. Look at the physical check sitting in your printer and enter that number. This is where check-number mixups happen — take two seconds to confirm.
- Check the boxes next to the checks you want to print (they're usually all selected).
- Click OK, confirm your printer and check style, then click Print.
- After printing, QuickBooks asks you to confirm that the checks printed correctly. If everything looks right, click OK. If a check jammed or printed wrong, check the Reprint box next to it so QuickBooks knows to print it again — with a fresh check number.
Step 4: Fix alignment issues (the reason most people are here)
If the date, payee, or dollar amount doesn't land in the right boxes on your check stock, don't keep burning through real checks. Here's the fix:
- Go to File > Printer Setup again.
- Select Check/Paycheck in the Form Name dropdown.
- Click Align.
- In the Fine Alignment window, you'll see Vertical and Horizontal adjustment fields. Enter small adjustments to nudge the printed text up, down, left, or right.
- Click Print Sample — and print it on plain paper, not your check stock. Hold the sample against a real check and check that the date, payee line, amount box, and signature line all sit where they should.
- Adjust and reprint the sample until it lines up, then click OK.
Small increments. That's the whole secret. People overshoot the alignment because they crank the numbers too far on the first try.
A few alignment gotchas
- Turn off "fit to page" or scaling in your printer preferences. If your printer is shrinking or stretching the page to fit, no amount of QuickBooks alignment will fix it.
- Print the sample on plain paper every time. Sounds obvious, but plenty of people test on real check stock and end up voiding three checks before they get it right.
- New printer, new alignment. Switching printers almost always means re-running the alignment, even with the same check stock.
- Update your printer drivers if alignment drifts over time for no clear reason.
Common mistakes to avoid
- Printing on the wrong check stock. Voucher settings with standard checks (or vice versa) will never line up. Match the Check Style in Printer Setup to what's actually in the tray.
- Entering the wrong starting check number. If you type in a number that doesn't match the physical check in the printer, your check numbers in QuickBooks won't match your real checks. That's a reconciliation headache waiting to happen.
- Handwriting some checks and printing others from the same account. Then your numbering gets tangled. Pick one method per account, or at least keep careful track of the manual ones.
- Skipping the confirmation step. That "did the checks print correctly?" prompt after printing exists for a reason. If one jammed and you clicked through without marking it, you'll have a duplicate payment floating around.
Conclusion!
That brings us to the end of this guide on how to print checks in QuickBooks Desktop and fix alignment issues. We hope the steps explained above helped you get your printer set up, print checks in batches, and fix misaligned printing. If you run into any difficulty while following the steps, consider consulting a qualified and experienced QuickBooks professional for further assistance.
FAQs
What check styles does QuickBooks Desktop support?
Three: Voucher (check with two stubs — the most common for businesses), Standard (check at the top, one stub below), and Wallet (check-sized, three to a page). Buy check stock that matches the style you select in File > Printer Setup.
Why are my checks printing in reverse order?
That's a printer driver setting, not a QuickBooks setting — your printer is likely set to print in reverse page order. Flip that setting in your printer preferences.
Why won't anything print from QuickBooks at all?
If checks won't print but other programs print fine, the issue is usually in QuickBooks' printer setup or a damaged print component. Reinstalling the printer driver or repairing QuickBooks typically resolves it.
Can I print just one check instead of a batch?
Yes. In the Write Checks window, leave Print Later unchecked and enter the physical check number, then print it right from that window.
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by XpertBooks Pro Team | Last updated Sep 30, 2026 | Accounting & Bookkeeping
E-commerce bookkeeping comes down to tracking gross sales separately from platform fees and payouts, staying on top of sales tax nexus across states, keeping inventory and COGS accurate, and reconciling payment processor payouts every month. Get these four right and your books stay clean.
You made $10,000 in sales on Shopify last month. Congratulations! ...Except your bank account only grew by about $8,700. Where did the other $1,300 go?
Platform fees. Payment processing charges. A couple of refunds. Maybe an advertising bill. If your bookkeeping only records the $10,000 in sales and the $8,700 that landed in your account, your books are wrong in two directions at once — and you'll find out at tax time, when it's too late to fix gracefully.
Selling on Amazon, Shopify, Etsy, or any marketplace adds layers that a regular retail business never deals with: the platform takes its cut before you see a dime, payouts arrive in batches days after the sale, refunds and chargebacks flow backward, and your sales tax obligations can span a dozen states. Here's how to keep your books honest through all of it.
Why e-commerce bookkeeping is its own animal
A traditional store sells something and pockets the cash. Simple. An online seller has at least four money movements per sale: the customer pays the platform, the platform takes fees, the platform batches the remainder into a payout, and the payout hits your bank days later.
That gap between "sale" and "money in the bank" is where bookkeeping goes to die. Add in inventory sitting in an Amazon warehouse you've never visited, sales tax rules that differ by state, and returns that reverse everything — and you've got a bookkeeping challenge that needs its own playbook.
1. Track gross sales and fees separately — always
This is the number-one rule of e-commerce bookkeeping, and the one most sellers break.
Say you sell $10,000 on Shopify in a month. Shopify takes roughly $290 in payment processing fees plus platform costs, and you issue $380 in refunds. The payout hitting your bank is around $9,330.
Wrong way to record it: one $9,330 deposit labeled "Shopify sales." That understates your revenue (the IRS sees $10,000 in sales) and hides your fee expenses — which are tax-deductible.
Right way: record the full $10,000 as sales income, then record the platform fees, processing charges, and refunds as their own expense line items. Yes, it's more entries. It's also correct, and your accountant will be able to actually deduct those fees instead of guessing.
For Amazon sellers, the same principle applies to referral fees, FBA fulfillment fees, storage fees, and advertising costs — each is a separate, deductible expense. Amazon's settlement reports break these down; use them.
2. Reconcile payouts like your business depends on it (it does)
Platform payouts are batch deposits that combine many orders minus many fees. They're almost impossible to match to individual sales, and that's fine — you don't need to.
What you *do* need: at month-end, your recorded payouts should match your bank deposits, and your recorded sales should match your platform's sales reports. A simple monthly routine:
- Pull the platform's payout report (Shopify Payments payout report, Amazon settlement report).
- Compare each payout to the matching bank deposit.
- Investigate anything that doesn't line up — missing payouts are more common than you'd think, especially with Amazon's rolling reserve.
Do this monthly, not annually. Catching a missing $2,000 payout in February is a quick support ticket; catching it next April is a forensic project.
3. Get serious about sales tax nexus
Here's where e-commerce gets legally tricky. You don't just owe sales tax in your home state — you may owe it in every state where you have nexus, which can mean:
- Physical presence (your office, warehouse, or employees)
- Inventory stored in a state (hello, Amazon FBA sellers — your products sit in warehouses across the country, and that creates nexus)
- Economic nexus (exceeding a state's sales or transaction threshold, often $100,000 in sales or 200 transactions)
Most states now require marketplace facilitators (Amazon, Etsy) to collect sales tax on your behalf — but not all platforms, not all states, and not all product types. Shopify, for example, generally leaves collection to you. You need to know, state by state, who's collecting and who isn't. This is genuinely one area where a professional's guidance pays for itself.
4. Keep inventory and COGS accurate
If you sell physical products, your inventory is money sitting on a shelf (or in an FBA warehouse). Sloppy inventory tracking means wrong cost of goods sold, which means wrong profit figures, which means wrong taxes.
- Track inventory quantities and costs in QuickBooks or your inventory system — not in a spreadsheet you update "when you remember."
- Count inventory regularly. Annual counts are the minimum; quarterly is better for active sellers. Amazon's inventory reports help, but they're not a substitute for your own records.
- Record COGS when you sell, not when you buy. Buying $5,000 of inventory isn't a $5,000 expense — it's an asset swap (cash becomes inventory). The expense happens when each unit sells.
- Write off dead stock. Products that will never sell are still on your books as assets. Clearing them out (even at a loss) gives you an honest balance sheet and a legitimate deduction.
5. Separate your business finances completely
Mixing personal and business money is the fastest way to make e-commerce bookkeeping miserable. One dedicated business checking account, one business credit card — and run every platform payout, ad spend, and supplier payment through them. When everything business flows through two accounts, reconciliation takes minutes instead of hours.
6. Use integrations — but don't trust them blindly
QuickBooks connects with Shopify, Amazon, and most major platforms through integration apps that sync sales, fees, and payouts automatically. These save enormous amounts of time, and for a growing store they're practically mandatory.
But integrations break. APIs change, syncs fail silently, and duplicates appear. Check your integration's sync status weekly, and spot-check a handful of synced transactions against your platform reports each month. An integration you never verify is just automated errors. (Sync failures are common enough that we've covered how to fix them — see the link below.)
A monthly bookkeeping routine that actually works
- Reconcile all platform payouts against bank deposits
- Record fees, refunds, and chargebacks as separate entries
- Update inventory counts and COGS
- Review sales tax collection vs. what's owed, state by state
- Check integration sync health
- Set aside estimated taxes (e-commerce income is lumpy — don't get caught short)
Thirty to sixty minutes a month. That's the whole routine once the system is set up.
Conclusion!
That brings us to the end of this guide on bookkeeping for e-commerce businesses. We hope the tips explained above helped you understand how to track platform fees, reconcile payouts, handle sales tax nexus, and keep your inventory honest. If you run into any difficulty applying them, consider consulting a qualified and experienced QuickBooks professional for further assistance.
FAQs
Do I need separate bookkeeping for each platform I sell on?
Not separate books — one set of books, but track each platform's sales, fees, and payouts as distinct line items or classes. That way you can see which platform is actually profitable after fees.
How do I handle Amazon FBA fees in my books?
Record them as separate operating expenses, broken out by type (referral, fulfillment, storage, advertising) using Amazon's settlement reports. They're all deductible business expenses — but only if you record them.
What about sales tax — doesn't Amazon handle that?
Amazon collects sales tax as a marketplace facilitator in most states, but you're still responsible for understanding your nexus, filing where required, and handling platforms like Shopify where collection is on you. Don't assume it's all handled.
Should I use cash or accrual accounting for my e-commerce business?
Accrual is generally better for e-commerce because of the timing gaps between sales, payouts, inventory purchases, and refunds. Cash accounting can make a profitable month look like a loss (or vice versa). If your revenue exceeds $30 million, the IRS requires accrual anyway.
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