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C
cpizzullo-pizzyp
March 13, 2025
Question

Inventory Acct differs greatly than Balance Sheet, why?

  • March 13, 2025
  • 1 reply
  • 0 views

Hi!

While doing taxes for our first year of selling and having inventory, noticed something that I can't quite explain and hoping someone here can shed some light.

When I got to Chart of Accounts, and look at my 1450 Inventory Account for Dec 31, 2024, it shows a balance of say $96k.  However, my Balance Sheet, for same account and date, only shows like $36k.  This is naturally driving me crazy trying to fill out H&R Block Tax software.
Thoughts?
Thank you!

1 reply

C
cpizzullo-pizzypAuthor
March 13, 2025

<update: right after I hit Post, a thought hit me and I tried this below which sheds some light on it now......so, when I run the Balance Sheet as accrual, it basically matches the Acct Balance. We are cash accounting so now I'm trying to wrap my head around the numbers tax software wants. This shouldn't be that hard, LOL.>

    C
    cpizzullo-pizzypAuthor
    March 13, 2025

    Basic question...if Inv. Acct Balance (accrual) is $96k, and Inv. in Balance Sheet/Trial Balance (cash method) is $36k, shouldn't the other $60k be showing in some other account in those reports?? If I get this answered, then perhaps I can figure out how to enter into H&R Block.

    Candice C
    Candice C
    March 13, 2025

    Hey, @cpizzullo-pizzyp. 

     

    Let's work together to figure out why there is differences on the reports. 

     

    Before moving forward, do you have your account set to Accrual or Cash based accounting? Here's how to check: 

     

    1. Go to the Gear icon in the top right-hand corner.
    2. Press the Account & Settings option.
    3. Tap the Advanced tab.
    4. Review the Accounting Method section.

     

    Based on which one this is set to, can be a factor in why this is occurring in your reports. If you set it to Accrual, this could be why the report is reading this way. 

     

    I'll be waiting for your response! 

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