Help with Damage Product for a Small Business Seller
Hello, I am a small business and sell online. I sell various items and one that i sell often is Body Lotion. I've had have gone bad and is unsellable. The way I do my COGS, is the model of, whatever I sell, I record. So a typical sale goes like this, I buy for 4 dollars, and sell for 20.00, after expenses I make 9 dollars. I do this for every single item. Whatever I sell I record, so I have a lot of inventory(waiting), but when I sell it, I record it. Its NOT the typical model of, total COGS for the year Minus Gross Sales equals Profit. I believe its called CASH BASED METHOD. For this type of record Cost of Goods Sold method, How much I am allowed to claim as Damaged? Can I write off ONE Percent? I have several hundreds of dollars of damaged product, Should I do it in one year? or mark it down thru several years? Any and All help is appreciated. Thank-you
