# Rhinestone Inventory



## wendy7314 (Apr 27, 2013)

My accountant says she needs a full inventory. How do I inventory loose rhinestones?


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## SilentPenguin (Nov 29, 2011)

I would say guesstimate the remaining amount, but depends how long you'll be holding onto them. Its arguable for COG but technically your goods already made your just decorating it but it depends on sums involved, have you asked your accountant how they expect this?

I just done my end of year S/T and i just ignored it my account put them down as COG. But then again i only have a small amount maybe 5 kilos ? as its just a sideline, if this is your main business then it could get tricky!


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## BlingItOn (May 29, 2008)

I just estimate. My account says to estimate low because you can't write off unsold materials.


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## Leg cramps (Feb 9, 2009)

you can also use a digital scale.


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## wendy7314 (Apr 27, 2013)

I have a scale.. Do you know what amounts the different stones weigh? 

Sent from my SCH-I545 using T-Shirt Forums


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## SilentPenguin (Nov 29, 2011)

Can you weight just one stone?


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## BlingItOn (May 29, 2008)

Since most vendors sell their rhinestones by the gross you could count out 1 gross and get a weight on that and then divide that amount into your total weight to find out approx. how many gross you have of each color. Or you can estimate which would be a lot quicker.


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## Liberty (Jul 18, 2006)

Oh my... inventory of rhinestones?

Well in almost 30 years in this industry and several accountants over those years, all have had the exact same advise regarding this type of thing.

Be it rhinestones or thread or cad-cut materials or ink or any other consumable used in production... we expense it when purchased. Same holds true for office supplies, showroom samples, toilet paper, stamps, etc. In the grand scheme of a year's worth of sales and cost of goods sold, your rhinestone inventory should really be insignificant UNLESS your business is breaking bulk and selling rhinestones.

Over the course of years in business, this method would have little to no impact on your numbers beyond the first and last year. 

Concentrate on selling more and less on counting of rhinestones.

Ask your accountant if he measures the unused part of a roll of adding machine tape? Or the number of sheets of unused printer paper? OK, so maybe that's a little harsh but you get my point.

If you maintain an inventory of finished goods for resale, that's different.


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## BlingItOn (May 29, 2008)

Each state I'm sure has their own laws in regards to year end inventory. My accountant asks that I count all inventory items that I use for resale. This includes items such as rhinestones, apparel items and vinyl. As I mentioned my accountant does not expect me to count every rhinestone but to merely estimate the value that I have on hand. She also mentioned that it is better to estimate the value low. If you have too much inventory on hand it is less that you get to write off. I also try not to make any big purchases until after the new year so there is less to count.


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## Liberty (Jul 18, 2006)

Inventory requirements are Federal EXCEPT in states where you have to pay a property tax on inventory.

GAAP, Generally Accepted Accounting Principles, will drive it. Fact of the matter is that on items like this, once you break the package it literally will cost more to sell the remainder than the item is worth. You are perfectly fine to expense these things at purchase.

Now all of this is predicated on your reporting method and I am assuming you are filing Cash Basis and not Accrual. If you are turning $1M and have thousands of dollars in standing inventory then you should likely be filing Accrual. For most of us, this is not the case, Cash Basis is just fine.

But the bottom line is, you are paying an accountant for services, it only makes sense to trust what they are advising. Also doesn't hurt to question them from an educated perspective.

Good luck...


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