Bookkeep's Shopify Accounting Automation

Bookkeep's integration with Shopify allows for seamless automation of accounting tasks on a daily basis. By consolidating sales and Cost of Goods Sold (COGS) into a single entry each day, Bookkeep provides a clear summary of the previous day's performance. Each payout is posted separately, facilitating easy reconciliation with bank statements. This streamlined approach simplifies the accounting process, allowing Shopify store owners to focus on growing their business.

Automated Journal Entries

The three journal entry postings we automate with Shopify are:

1. Ecommerce (Sales)
2. Payments Deposit (Payouts)
3. COGS (Cost of Goods Sold)

In the Shopify Settings within Bookkeep on the Connections page, customers have the flexibility to choose how they want to break down gross sales and refund amounts - either by product name or product category. This customization enhances visibility and understanding of sales performance, enabling more informed decision-making for business growth and financial management.

Sales Summary Automation

The Ecommerce journal entry posts the previous day's sales to your accounting platform daily. It captures the total sales amount, from gross sales to net sales after discounts, refunds, and other adjustments. This entry provides a breakdown of payments received by tender types such as Shopify payments, third-party gateways, PayPal, and gift cards, ensuring transparency and helping reconcile transactions.

The Shopify Pending Payments line typically captures accounts receivable situations where an order has been placed but remains unpaid. This can occur in several scenarios:

• An order is placed but paid at a later time.
• A pending refund exists—where a refund has been initiated but is still being processed over multiple days.
• An order is imported into Shopify without its associated payment details.

Deposit/Payout Automation

Another key journal entry we handle for Shopify is the Payments Deposit. This entry records any new deposits made to your bank account related to Shopify Payments on a daily basis. Each time a deposit is made to your bank account, this transaction is captured in the journal entry along with any fees associated with processing these sales by Shopify.

The complexity of the payouts journal entry, including labeling adjustments as sales tax withheld and identifying Shop Cash adjustments, is further explained in these articles: Sales Tax Withheld and Shop Cash Adjustments.

Cost of Goods Sold (COGS) Automation

Our final journal entry for Shopify focuses on Cost of Goods Sold (COGS). In this entry, we record and post the cost of goods sold for the previous day's sales. This process reflects an increase in COGS and a decrease in Inventory, as sold items are transferred from inventory to COGS.

Any products/variants deleted or updated in Shopify may display the wrong unit cost, as Shopify only shows the latest cost and does not show the cost for a deleted item.

If you have any questions regarding our Shopify accounting automation, feel free to contact support@bookkeep.com.