Inventory? You Need Accrual.

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One of the most foundational decisions for a new business is choosing an accounting method. The choice is critical because it determines when you report income and deduct expenses. The either/or dilemma is often between using the simpler Cash Method and the compliance requirement of the Accrual Method.

You generally must use an accrual method if your business has an inventory of items for sale. Inventory includes goods held for sale and the raw materials used to create them. This is a key piece of Sound compliance knowledge that is essential for setting up your business correctly. Once you adopt an accounting method, you must use it consistently, making this a crucial Sound decision to make in your first 30 days.

Ready to build a solid financial foundation? Download the free 30-day Tax Setup Checklist for New Business Owners now: https://www.safesimplesound.com/new-business-your-first-30-days-tax-setup/.


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DISCLAIMER: This content is for educational purposes only and should not be considered personalized financial advice. Always consult with a qualified financial professional before making financial decisions.