Amazon COGS Automation In Bookkeep | Build with Bookkeep

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Bookkeep provides a streamlined way to automate Cost of Goods Sold (COGS) for Amazon sellers who maintain item costs in Bookkeep. Using our COGS automation feature, you can simplify accounting, reduce manual work, and ensure accurate financial reporting.

For more details on Bookkeep Managed COGS, see our main documentation: Bookkeep Managed COGS.

How Bookkeep Handles Amazon COGS

Amazon’s reporting now includes both deferred and released transactions, which affects how COGS is recognized. Bookkeep offers two approaches to align with your accounting and reporting needs:

1. Released Transactions Only

• Captures COGS for transactions that have been released to the Amazon summary journal entry.
• Aligns with the Amazon summary journal entry.
• Best for sellers who want COGS recorded only when transactions are released.

2. Deferred + Released Transactions

• Captures COGS for both deferred and released transactions.
• Aligns with the Amazon deferred and released summary, reflecting all activity in reporting.
• Recommended now that Amazon includes both deferred and released transactions in their reporting.
• Provides a more comprehensive view of COGS, even if some transactions are deferred.

Benefits of Bookkeep COGS Automation for Amazon

• Eliminates manual calculation and journal entry creation.
• Ensures accurate matching of revenue and COGS in QuickBooks, Xero, or other connected accounting software.
• Provides flexibility to choose the approach that aligns with your business practices and reporting needs.

Getting Started

1. Maintain your item costs in Bookkeep (required for COGS automation). This is activated in the Settings for your Amazon connection and requires selecting the currency of the costs:

2. Select your preferred COGS option:

   • Released transactions only, or
   • Deferred + released transactions.

3. Bookkeep will automatically generate COGS journal entries each day in your accounting system according to your chosen option.

Choosing the Right COGS Recognition Method

If you are unsure which option to select, consider how you recognize revenue in your accounting system. If you compare against Amazon’s reporting, the deferred + released approach is generally recommended.

By using Bookkeep’s Amazon COGS automation, sellers can save time, reduce errors, and maintain accurate financials, even with Amazon’s recent reporting changes.