just out of curiosity, what is everyone else doing with their shipping and freight costs - are you spreading them over the individual unit costs of the items purchased, or are you expensing them separately and not including them as part of inventory cost?
would be curious to know what others are doing in this regard
thank you, kevin
We don't include the freight charges in RMS as inventory costs. We do however charge it out in Quick Books as a separate account. For example:
Invoice 562 for $ 2562.89 Inventory $2491.17 Freight allowance $71.72
We do round to the 9's or 5's such as an item retail sales for 9.95 we use
9.99We do the same thing as Elizabeth. We keep our inventory and freight charges separate. Freight is a separate line item booked to cost of goods in the month the product is received. After the invoice has downloaded into Quickbooks, we modify it to add the freight charge.
Before I opened up my own store, I worked for a very large catalog operation and we originally used the method I just described, after a major computer infrastructure change, we were able to change our accounting method to book freight into the item cost (inventory) when it was received, yet still report it separately to manage that portion of our cost of goods.
Both have their merits, however, I rarely know the freight cost at the time I receive product, so I have found that booking it separately in Quickbooks works easier for me and gives me the visibility I need for that expense.
Juli
"ksk> just out of curiosity, what is everyone else doing with their shipping and
Have something to add? Share your thoughts — no account required.
Ask the community — no account required