@taxedtoruin wrote:
....I've just been plugging numbers into the Materials and Supplies box to get what I think my end of year inventory should be (3012-87 = $2925).
The Cost of Goods Sold formula for retail businesses, generally, is:
Beginning Inventory (at the beginning of the tax year) Plus Purchases Minus Ending Inventory (at the end of the tax year). In the instance you cited, that would be $3012 (beginning inventory) less $2925 (ending inventory) which would equal a CGS of $87 (since you apparently had no purchases during the tax year).
In future years, you can enter the costs of materials and supplies used to produce your books or, alternatively, enter those costs as purchases.
Note that, if you are a small business taxpayer, you are not required to keep an inventory for federal income tax purposes.
See https://www.irs.gov/instructions/i1040sc#idm140229396703984
