Amazon seller accounting: how to book settlements, fees and inventory
Short answer: An Amazon deposit is not your sales. Each payout is net of referral and fulfillment fees, advertising, refunds and reserves, so booking deposits as revenue understates sales and hides costs. Good Amazon accounting records each settlement in full (gross sales, each fee type, refunds, reserves), tracks inventory and cost of goods sold, and reconciles the net to the bank deposit.
Why Amazon payouts do not match sales
- Fees: referral fees, fulfillment (FBA) fees, storage fees and other charges are deducted before you are paid.
- Advertising: sponsored ads may be deducted from payouts.
- Refunds and reimbursements: customer refunds reduce payouts; inventory reimbursements add to them.
- Reserves: Amazon may hold back part of a payout and release it later.
- Timing: settlement periods do not line up with calendar months.
How to book a settlement
- Record gross product sales and shipping income.
- Record each fee type to its own expense account.
- Record refunds, reimbursements and promotions separately.
- Record reserve holds and releases.
- Confirm the net equals the bank deposit.
- Record cost of goods sold from your inventory records.
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Inventory and cost of goods
Track units and landed cost (product, freight, duties) as inventory, and expense cost of goods when units sell. FBA inventory in Amazon warehouses is still your inventory. Keep records that support your numbers; the IRS explains what business records to keep.
When to get help
- You sell on more than one channel or in more than one marketplace
- Your books show deposits as sales
- You cannot tell margin by product
- You are months behind
Check margins with the e-commerce profit margin calculator, see what e-commerce bookkeeping costs, or read which kind of accountant you need. Tax questions go to a CPA or tax professional.
Frequently asked questions
Why doesn't my Amazon payout match my sales?
Payouts are net of fees, ads, refunds and reserves, and settlement periods don't match calendar months.
Should I record Amazon deposits as revenue?
No. Record gross sales and each fee, refund and reserve separately so the net matches the deposit.
How do I account for FBA inventory?
Track units and landed cost as inventory and expense cost of goods when units sell; FBA inventory is still yours.
Do I need an accountant for my Amazon business?
Many sellers use a bookkeeper or e-commerce accounting firm monthly and a CPA for tax returns, especially with several channels or inventory.
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