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Level 1

Does the value of my inventory at the end of the year included shipping cost to receive that inventory?

 
4 Replies
Level 10

Does the value of my inventory at the end of the year included shipping cost to receive that inventory?

Yes, it is the total cost you paid for the inventory.  Remember, if you include the shipping cost in inventory, you will not separately deduct it as an ordinary business expense.  Also, you will need to allocate the shipping cost to inventory as it is sold throughout the year to accurately account for the remaining inventory at the end of next year.

Level 1

Does the value of my inventory at the end of the year included shipping cost to receive that inventory?

If I don't include the shipping cost in inventory, and do deduct it as an ordinary business expense I wouldn't have to account for it in the remaining inventory at the end of the year correct?  Would that be easier?
Level 10

Does the value of my inventory at the end of the year included shipping cost to receive that inventory?

Yes.
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Level 11

Does the value of my inventory at the end of the year included shipping cost to receive that inventory?

@elizableuco 

 

That wouldn't be proper.  The cost of inventory includes the cost of shipping to you.  Thus it should be allocated to the purchased items and deducted as the items are sold.