Bookkeeping for Manufacturers

What's included

• Accounts payable — vendor bills entered, coded to the right cost categories, and scheduled so you pay on time without draining cash early.
• Accounts receivable — invoicing support, collections tracking and aging reports so you know who owes you what.
• Payroll accounting — payroll recorded with direct and indirect labor separated, so labor cost reaches your product and job costs.
• Inventory and COGS — purchases, landed cost (freight and duty) and inventory movements recorded so cost of goods sold matches what you actually shipped.
• Bank and credit card reconciliations — every account reconciled every month.
• Monthly financial statements — balance sheet, income statement and cash flow statement on an accrual basis.

Why generic bookkeeping fails manufacturers

Most bookkeeping is built around a simple question: what came in and what went out? Manufacturers need to answer harder ones — what did this product or job actually cost, how much cash is sitting in inventory, and why did margin drop last month?

When the books are set up the generic way, the same problems appear again and again:

• Freight and duty sit in overhead instead of product cost, so every margin looks better than it is.
• Materials are expensed when bought instead of when the product ships, so profit swings with purchasing, not performance.
• Direct and indirect labor are lumped together, so there's no way to calculate a real labor rate for quoting.
• Inventory on the books drifts away from inventory on the floor until a large write-down lands in one month.

MPS Acoustics is a good example: its margins weren't wrong — the timing of cost recognition was. Fixing that was a bookkeeping and costing problem before it was ever a CFO problem.

Who it's for

• Manufacturers moving from cash-basis to accrual accounting.
• Owner-led shops whose bookkeeper has left, or who've outgrown a part-time bookkeeper.
• Companies whose books are behind and need catch-up and clean-up.
• Product companies that hold inventory and sell through wholesale, ecommerce or both — see accounting for product and ecommerce brands.

Bookkeeping that grows with you

Clean books are the foundation, not the finish line. Because we set up your chart of accounts and processes the way a controller and CFO would, you can add controller services or a fractional CFO later without rebuilding anything.

Frequently asked questions

What is the difference between bookkeeping and accounting for a manufacturer?

Bookkeeping records the transactions. Accounting turns them into accurate financial statements and decisions — inventory valuation, cost of goods sold, accruals, job costing and analysis. For a manufacturer, the bookkeeping has to be set up with the accounting in mind or the margins will be wrong.

Should a manufacturer use cash or accrual accounting?

Accrual. Cash-basis books record costs when you pay for them, not when you use them, so a month with heavy material purchases looks unprofitable and the next month looks great. Accrual accounting matches costs to the revenue they produce, which is the only way to see true margins.

Can you clean up books that are behind?

Yes. We regularly catch up and clean up books, reconcile prior months and correct inventory and COGS treatment before moving to a monthly routine.

Do you work with our existing software?

Yes. We work with QuickBooks, Zoho and other common platforms, and we help when it's time to move to a better-fitting system.

How much does bookkeeping for a manufacturer cost?

Pricing depends on transaction volume and complexity. Our Maintain plan for pre-revenue companies is $499 per month (billed annually), and plans for revenue-generating companies start at $1,500 per month. See pricing.

Do you file taxes?

No. Accounovation is not a CPA firm. We give your tax preparer clean, reconciled books and the supporting schedules they need.