Freight on inventory items

Ask your accountant on how they want you to handle the freight on your inventory purchases. They are in the best position to advise you on this.

Hope this helps. If so please mark solved, if not please ask more questions. Thanks!

COGS = Cost of Goods Sold.  The cost of inbound freight that should be added to your items sold.  Along with any other expenses incurred to sell your item(s) ie: additional outside vendor costs, improvements to your item(s), etc. 

The cost to ship the item(s) out is outbound freight which is a expense to you -ie: cost of doing business.

There are a few different ways to handle your inbound freight.  If you know what it is at the time you receive in your items you can allocate that cost across all of your items.  

If your inbound freight charges come after, you can do an inventory value adjustment at a later date to add that cost to your item(s).  See this great article below: 

http://www.cpa911.com/read_art...

Post back and let us know if this was helpful or if you are in need of additional information or if you have more questions.