Hello,
I am a Sole-Proprietor. I resell digital goods via internet (i.e. books, music etc). My suppliers provide files for distribution and I put it on a server for sell. I pay suppliers 50% from sales for the items after the items are sold. I am confused on how to figure the expenses on Schedule C - "Cost Of Goods Sold". These items are non-inventory items and I actually do not buy the items (but accumulate the amount and pay later). I think to do the following on the Schedule C (Cost Of Goods Sold):
-----------------------------------------------
Inventory at beginning of year - 0
Purchases less cost of items withdrawn for personal use - The total amount paid to suppliers
Cost of labor - 0
Materials and supplies - 0
Other costs - 0
Inventory at end of year - 0
-----------------------------------------------
Is this way correct? Please advice. Thanks you!What is the name of your state?
I am a Sole-Proprietor. I resell digital goods via internet (i.e. books, music etc). My suppliers provide files for distribution and I put it on a server for sell. I pay suppliers 50% from sales for the items after the items are sold. I am confused on how to figure the expenses on Schedule C - "Cost Of Goods Sold". These items are non-inventory items and I actually do not buy the items (but accumulate the amount and pay later). I think to do the following on the Schedule C (Cost Of Goods Sold):
-----------------------------------------------
Inventory at beginning of year - 0
Purchases less cost of items withdrawn for personal use - The total amount paid to suppliers
Cost of labor - 0
Materials and supplies - 0
Other costs - 0
Inventory at end of year - 0
-----------------------------------------------
Is this way correct? Please advice. Thanks you!What is the name of your state?