This guide breaks down eCommerce bookkeeping from Shopify sales to monthly reporting. Whether you're doing it yourself or thinking of outsourcing, here’s what every modern eCommerce brand needs to know.
Online stores often deal with dozens or hundreds of orders per day. That means frequent deposits, returns, and adjustments. Traditional bookkeeping can't keep up with this kind of complexity.
Shopify takes a cut. So does PayPal, Stripe, or your merchant processor. Add in refunds, chargebacks, and currency conversions—suddenly, your gross sales aren’t telling the real story.
If you're selling across regions, you're responsible for collecting and reporting different tax rates. Bookkeeping needs to reflect these liabilities accurately and ensure you’re not underreporting.
Unlike service-based businesses, eCommerce bookkeeping revolves around inventory—what comes in, what goes out, and how it affects your margins.
You're likely selling on multiple platforms—Shopify, Amazon, Etsy. Bookkeeping needs to consolidate all that into one financial picture.
Shopify shows sales, payouts, and taxes collected—but not true cost of goods, detailed expenses, or your actual net income. It’s a sales tool, not a full accounting system.
Shopify can misrepresent refunds, overstate revenue (by not deducting fees), and exclude expenses like Facebook Ads or software tools unless integrated with your accounting system.
Most eCommerce businesses use:
QuickBooks Online: Great reporting, customizable, cloud-based.
Xero: Strong international support, real-time dashboards.
Set up your Chart of Accounts with categories like:
Product Sales
Shipping Income
Returns & Refunds
Payment Processor Fees
Advertising Expenses
Inventory Purchases
Use integrations like A2X, Webgility, or Synder to automatically transfer Shopify data into your accounting software with clean, categorized entries.
Outdated inventory means inaccurate COGS and missed tax deductions. You may think you’re profitable—until the books say otherwise.
FIFO (First In, First Out): Most common and IRS-compliant.
LIFO (Last In, First Out): Rarely used in eCommerce.
Average Cost: Simplified but may be less accurate.
Cin7
DEAR Systems
QuickBooks Commerce
These sync sales and inventory changes automatically to keep your books updated.
Each payment processor pays out differently. Bookkeeping needs to account for gross revenue, less fees, and reconcile against actual bank deposits.
Track each separately in your books so you don’t inflate sales or overlook revenue loss. Automation tools help separate these categories for accurate reporting.
Fees can reduce your actual cash significantly. Always categorize them clearly to avoid overstating income.
Create separate line items in your accounting for:
Shopify Fees
Stripe/PayPal Fees
Bank Charges
Third-party App Fees
These tools automate the sync of sales, fees, tax, and shipping from Shopify into your books. They ensure:
Proper accrual timing
Daily summaries vs. individual transactions
Cleaner reconciliation
Set up automatic P&L, inventory valuation, and sales tax reports. It saves time and reduces risk of forgetting important reviews.
Match Shopify data with your accounting software and bank.
Update cost basis and make adjustments for lost or damaged items.
Profit & Loss Statement
Balance Sheet
Cash Flow Statement
Review these monthly to track trends and make informed decisions.
Your gross profit depends on how accurately you record COGS. If it's off, your taxes and strategy will be too.
Update with each purchase order or inventory shipment. Include shipping costs and vendor fees for full accuracy.
These reports reveal if you’re scaling profitably, overspending, or sitting on dead inventory.
ROAS: Return on ad spend
AOV: Average order value
LTV: Lifetime value of a customer
Connect these to your books to understand actual profitability by marketing effort.
They should understand Shopify, inventory costing, sales tax, and have experience with automation tools.
Do you specialize in eCommerce clients?
What platforms do you integrate with?
How often do you reconcile sales and payouts?
A growing apparel brand relied on Shopify reports. They had no real grasp of net income, COGS, or taxes due.
With A2X and QuickBooks Online, plus a dedicated bookkeeper, they:
Automated their entries
Cleaned up their chart of accounts
Saved 20+ hours/month in admin work
Identified $8,000 in recurring monthly losses from poor pricing
No, but you need to segment each channel’s revenue and fees clearly in one system.
Adjust your inventory quantity and record the value of the return as a reversal of COGS.
QuickBooks Online + A2X is a top combo. Xero and Synder are also strong alternatives.
Weekly or biweekly. Monthly at a minimum to avoid catching errors too late.
Yes, but only for very small stores. As your sales grow, DIY methods quickly fall short.
Not collecting/remitting sales tax in all required states
Confusing revenue with profit
Missing deductible expenses like platform fees or software
Bookkeeping for eCommerce doesn't have to be confusing. With the right tools, systems, and expert support, you can turn a chaotic mess into a predictable, profitable machine.
Stop guessing and start growing—with clean books and clear financials at every stage.