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.
Long Beach's Trusted Bookkeeping Partner
The Next Step:
A Quick Discovery Call
Tell us where things stand with your books. We'll listen, ask a few questions, and give you a clear quote to get it handled.
More Questions
What documents should I gather for my bookkeeper every month?
At minimum, your bookkeeper needs bank statements, credit card statements, receipts for expenses, and any invoices you've sent or received. Building a simple monthly habit around gathering these keeps your books accurate and saves time on both sides.
Read answerWhat should I look for when choosing a remote bookkeeper?
Focus on communication habits, industry experience, a clear process, and how they handle your financial data. The right remote bookkeeper should make things feel easier, not add confusion to your week.
Read answerWhat bookkeeping does a property management company need?
Property management bookkeeping revolves around keeping owner and tenant funds separate from your operating money, tracking everything at the property level, and producing accurate owner statements. The complexity comes from managing other people's money alongside your own.
Read answerWhy is it important to keep personal and business money in separate accounts?
Separate accounts protect your legal liability, simplify tax preparation, and give you accurate financial data to make decisions. Mixing personal and business money creates problems that get more expensive and harder to fix the longer it goes on.
Read answerWhat bookkeeping foundations should I put in place when launching a business?
Start with a separate business bank account, properly configured accounting software, and a habit of recording transactions from day one. Getting these basics right early prevents expensive cleanup later.
Read answerHow do I track inventory costs for my Shopify store?
Shopify tracks sales and stock counts but doesn't handle inventory costing the way your books need it. You need an accounting system like QuickBooks Online connected to Shopify to properly track what you paid for products, landed costs, and cost of goods sold.
Read answer
