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Inventory – broken item

MA
11/08/2023
Question

Hello everyone!

I have a question about how it works with inventory of trade goods when certain parts for the finished product are unusable. Or when there are other situations.

For example:

  1. My scented candles in glass jars are handmade in Spain, and some of the glass jars have scratches/imperfections due to transport/manufacturing, which means I cannot sell them. How do I deal with this in my inventory?

  2. Since everything is handmade, it is sometimes impossible to stick the sticker straight and without dust. So sometimes I have an amount of stickers (quite a lot) that have to go in the bin. How does this work?

  3. I recently accidentally dropped two candles and broke them. How do I deal with this in terms of inventory?

  4. Since everything is handmade, it is sometimes impossible to stick the sticker straight and without dust. So sometimes I have an amount of stickers (quite a lot) that

  5. Finally, how does it work if I ‘give away’ a candle free, for example for an Instagram giveaway, or if I collaborate with an influencer and give them this candle?

Thanks a lot in advance.

Actually, it's all the same.

You record everything as an expense, so just record each expense as a purchase of goods.But when you have to count your closing inventory, i.e. on 31 December, just count what is there, of course, as the opposite would be difficult :) And as a result, it will automatically show that there is less in your inventory, the broken items are no longer there, the unused stickers are not there, etc.

Just count your inventory at the end of the year, see what you still have in stock, and you're done.

So I don't need to mention anywhere when items are broken, when I've 'given' items to an influencer, etc.?

No, you don't need to mention anything specifically to be okay.

You can keep track of this somewhere if it really involves large volumes. That way, you have some documentation in case of a tax audit, for example.

But then it's more to justify any discrepancies in your figures during an audit.

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