A year unreconciled, an acquisition, and a sale

Where it started

The founder bought the business from its previous owner in April 2025. Nearly a year of activity across a business checking account and two credit cards had never been reconciled.

Six marketplaces paid out in lump sums, so sales and fees were invisible. Inventory from the acquisition was tracked by hand, the acquisition financing and a private loan were not in the books, and discounts and refunds sat on one line, which made returns look far larger than they were.

What the books were hiding

• The $190,000 purchase was booked as one undifferentiated figure.
• Inventory carried at a stated original cost of roughly $429,000, against the $140,000 actually paid for it.
• About $13,900 of discounts mixed in with just over $200 of genuine returns.
• About $2,500 (at cost) of gifted and promotional stock buried in discounts.

What we did

• Reviewed the QuickBooks Online file and added the missing inventory, COGS and loan accounts.
• Split every Shopify, Amazon, Walmart, Faire and Creoate payout into sales, fees, advertising and shipping, with rules for recurring activity.
• Reconciled checking and both credit cards through December 2025, including expenses the founder paid personally before business cards were issued.
• Allocated the purchase price: inventory $140,000, trademarks $22,000, domains $10,000, website $8,000, goodwill $10,000.
• Built item-level inventory and COGS with journal entries on QuickBooks Online Simple Start, which has no inventory module, instead of forcing an upgrade. COGS is recognised only against verified sales.
• Separated discounts from refunds and moved promotional stock to Advertising & Marketing at cost.
• Recorded the acquisition financing, the private loan and the founder-funded startup costs.

Result

A clean balance sheet and P&L within about three weeks. When the founder sold the business, we closed the partial year and delivered handover-ready statements through Q1 2026.