Cost of Goods Sold (COGS) tracking is a feature in Link My Books that lets you track the cost of the units sold during each settlement period. This helps ensure that your financial reports in Xero or QuickBooks accurately reflect inventory costs as products are sold.

Once enabled, Link My Books will automatically calculate the total value of products sold in each payout by using the landed product costs you’ve entered on the Product Costs page.

Please visit these help articles for further options on how to add your Product Costs;

How to bulk upload your product costs

Enter Product Costs Monthly

Here’s how it works:

In Xero that would look something like this:

Let's break down the lines of the above bill for clarity.

Line 1 - "Inventory Deduction From Fulfilment by Amazon (FBA)" is the COGS figure being deducted from an asset account, in this case, "Amazon Inventory".

Line 2 - "Cost of Goods Sold Fulfilment by Amazon (FBA)" is the COGS figure being added to a direct costs account, in this case, "Amazon Cost Of Goods Sold".

The bill will always balance to zero. We are simply moving value between accounts to reflect inventory movement as cost.

Link My Books tracks COGS automatically for units that are physically sold. For inventory events such as lost, reimbursed, or disposed of inventory at Amazon FBA, you will need to perform manual balance sheet adjustments based on inventory valuation. You can review your month-end inventory values on the "Inventory Values" page to aid this process.

When a refund is issued, Link My Books posts the refund transaction and any fee reversals but does not reverse the original COGS entry (e.g., returnless refunds in Amazon FBA). This is because the platform does not confirm whether the item was returned to inventory. COGS remains intact for refunds where items are not returned.

For replacements processed by Amazon as new orders, Link My Books captures COGS for both the initial shipment and the replacement. However, this depends on whether the replacement appears as a new order in Amazon payouts.

If a payout includes a sample order where the customer covers shipping fees, you can check payout details to verify whether COGS were applied. Such data provides insight into shipping and sample-related revenue.

Go to the Product Costs page in Link My Books. You can enter product costs directly into the table;

or use the bulk upload option for faster entry;

This depends on how you account for inventory in your bookkeeping software:

Option A: You include all landed costs in your inventory asset account
Include:

Example:

Option B: You only include supplier cost in your inventory asset account
Only enter the product cost from the supplier.
​In this case: £5.50

📝 Tip: Match your Link My Books product cost values to your accounting method in Xero or QuickBooks.

Head to the Settlement Settings page and toggle on COGS. You’ll then be prompted to:

If you don’t have these accounts set up yet, Link My Books can create default accounts for you.

🛒 Amazon Users: You’ll set different accounts for each fulfilment type (FBA, FBM, Non-Amazon Orders).
🛍️ eBay, Shopify, and Etsy Users: You’ll only need to set one inventory and one COGS account.

You can also choose which COGS sources to include (e.g. exclude Non-Amazon orders if needed);

Once set up, settlements not yet sent will be refreshed automatically. For those already sent, you’ll need to roll back and resend to apply COGS;

For users who wish to keep their Cost of Goods Sold (COGS) data separate from their primary accounting software, we offer an "Analytics Only COGS" option.

When this setting is enabled, all your COGS details will be visible and accessible within the dedicated analytics section of our application. Either within the settlement details;

Or directly within the Analytics tab;

This allows you to gain valuable insights into your product profitability and cost management directly within our platform.

Crucially, selecting this option means that your COGS data will not be posted to Xero or QuickBooks alongside your other settlement information. This provides flexibility for businesses that prefer to manage COGS internally or through other means, while still benefiting from the analytical capabilities of our system.

Once changes are made, all settlements that haven't been sent will automatically be refreshed. Any settlements that have been sent will need to be rolled back and resent with the new adjusted COGS details.

👉Tip: For eBay, Shopify & Etsy accounts you will only need to set one credit and debit account:

Once you complete the 2 steps above we will refresh all of your settlements (excluding ones that have already been sent to Xero/QuickBooks) and you will see a new COGS tab on the view settlement pages, as shown below:

If you expand open a COGS bill you can check that the landed cost of each product SKU is accurate and update it if needed as shown below.

If you need to change the currency of your landed costs or want to update all of your products in bulk you can do so from the Product Costs page.

Once COGS is turned on, we will from then on send both the Sales & Fees Invoice and the COGS Bill to Xero/QuickBooks when you click Send Settlement.

Link My Books automatically detects SKUs based on your settlement data, but we also provide extra tools to help you manage your SKUs more precisely — especially for handling inactive, future, or yet-to-be-detected SKUs.

You can hide SKUs from your active SKU list if they're no longer in use — for example, if you're no longer selling a particular product.

If you want to prepare for new product launches or set rules for SKUs that haven’t yet appeared in settlement data, you can enable the 'Allow SKU Creation' toggle which will allow you to set VAT rates before the first sale comes in.

These guidelines will help refine the accuracy and effectiveness of your COGS tracking in Link My Books.

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