What bookkeeping does an Amazon seller need?
The biggest mistake Amazon sellers make with their bookkeeping is recording Amazon payouts as revenue. That deposit hitting your bank account is not your sales number. It’s what’s left after Amazon takes referral fees, FBA fees, storage fees, and deducts returns and adjustments. If you treat the deposit as revenue, you’re understating your actual sales and hiding the true cost of selling on the platform.
Start by reconciling your Amazon settlement reports. Every two weeks Amazon sends a settlement that breaks down gross sales, fees, refunds, promotions, and the net payout. Your bookkeeping needs to record gross revenue at the top and then separately categorize each fee type as an expense. This is the only way to see what Amazon is actually charging you and whether those costs are trending up over time.
Track your fees in separate categories. Referral fees, FBA fulfillment fees, monthly storage fees, long-term storage fees, and advertising spend should each have their own line. When you lump them together, you lose the ability to spot problems. Maybe your ad spend is eating your margins on a specific product, or long-term storage fees are piling up on slow-moving inventory. You can’t fix what you can’t see.
Inventory accounting is where many Amazon sellers fall behind. Every unit you purchase is not an expense at the time of purchase. It’s an asset that becomes a cost of goods sold when it sells. If you expense inventory when you buy it, your profit and loss statement will swing wildly based on when you place orders rather than reflecting actual business performance. Proper COGS tracking by product or product category shows you which items are truly profitable after all costs are factored in.
Returns and refunds need their own handling too. Amazon processes returns and sometimes issues refunds before you even know about them. These need to be recorded as reductions to revenue, not as expenses. And if Amazon damages or loses inventory in their warehouse, any reimbursements you receive should be tracked so you can verify you’re actually getting paid for what’s owed.
Sales tax is one area where Amazon simplifies things. As a marketplace facilitator, Amazon collects and remits sales tax in most states. But you should still understand where you have nexus and confirm Amazon is handling it correctly for your situation, especially if you also sell through your own website or other channels.
A small business bookkeeping service familiar with e-commerce can set all of this up so your reports actually tell you something useful. The goal is knowing your real profit margins by product, understanding what Amazon is costing you, and having clean books ready for tax time without a year-end scramble.
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More Questions
What should I look for when reviewing my P&L each month?
Focus on revenue trends, gross profit margin, unusual expense changes, and how this month compares to previous months. A quick but consistent review each month helps you catch problems early and make better decisions.
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QuickBooks Online has become the standard because it makes collaboration between bookkeeper and business owner simple, connects directly to banks and apps, and produces reliable reports. It's not the only option, but it's the one most bookkeepers know inside and out.
Read answerCan a remote bookkeeper handle everything an in-house bookkeeper does?
Yes, in almost every case. Cloud-based accounting tools like QuickBooks Online make it possible for a remote bookkeeper to handle transaction categorization, reconciliation, reporting, and more without ever setting foot in your office.
Read answerHow does a tech startup keep clean books from day one?
Separate your business finances immediately, set up QuickBooks with a startup-appropriate chart of accounts, and build a weekly habit of recording transactions. The earlier your systems are in place, the easier everything gets when investors or tax deadlines show up.
Read answerWhat should I expect to pay for monthly bookkeeping services?
Most small businesses pay between $200 and $800 per month for bookkeeping, depending on transaction volume, number of accounts, and industry complexity. The baseline should include transaction categorization, reconciliation, and monthly financial statements.
Read answerCan a bookkeeper clean up my messy QuickBooks file?
Yes, and it's one of the most common things bookkeepers do. The process involves recategorizing transactions, reconciling accounts, removing duplicates, and getting your financial reports to accurately reflect how your business is performing.
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