How do I record item costs when I purchase inventory?

If you're tracking inventory at the item level (also called "continuous" inventory tracking) in Seller Ledger, you'll want to record the details of the products you purchase — things like SKU, product name, quantity, and unit cost. Doing so allows Seller Ledger to automatically match items to sales, reduce your inventory on hand, and calculate cost of goods sold for you.


This article walks through the different ways to record item cost information when you purchase inventory.


Before you get started: make sure inventory tracking is turned on

In order to record item-level cost information, you'll need to have inventory tracking turned on in Seller Ledger. If you're currently using "cash-based" tracking (where you categorize inventory purchases directly as Cost of Goods Sold), you won't see the options described in this article.


Learn how to turn on continuous inventory tracking here.


Step 1: Record the inventory purchase

There are two ways to get an inventory purchase into Seller Ledger, depending on how you paid.


Option A: You paid with a connected bank or credit card

If you purchased inventory with a bank account, credit card, or PayPal account that's connected to Seller Ledger, the purchase will import automatically. You just need to categorize it as Inventory.


  1. Click into your bank or credit card account from the dashboard.
  2. Find the purchase transaction and click to categorize it.

  1. Choose Inventory from the category list.

Once categorized, that purchase will show up under the Inventory → Balances tab with an Add details link next to it. You will also notice the "Purchases" total in the balances section has increased by the amount that you just categorized. And, because we have no history of that item selling year, it also gets added to your current inventory balance.


When you are ready to move on top Step 2 below, click the Add details button.


Option B: You paid with cash or a non-connected account

If you purchased inventory using cash, a personal account, or any other source that isn't connected to Seller Ledger, you can still record it manually.


  1. Go to the Inventory tab.
  2. Click the Add Inventory button.

  1. Enter the purchase date and who you purchased the item(s) from and continue to Step 2 below.

Step 2: Add the item details

Whether your click Add details from a purchase transaction or click the Add Inventory button, you'll see three different ways to record the item information for that purchase.

Option 1: Type in the details manually

This is the most straightforward approach and works well when you only have a handful of items in the purchase.


  1. Start typing the product name. If you've previously sold this product on a connected marketplace, Seller Ledger will suggest it from your existing product list. If it's new, choose Create New Product from the drop-down.

If you are creating a new product, you'll see an extra field for SKU. It is optional, but highly recommended — it helps Seller Ledger automatically match items to sales).

  1. Enter the Quantity purchased and the Unit Cost of each item. Seller Ledger will calculate the total costs for that item. If you have more, different items, you can click Add another item and continue entering details.

Notice, in the above example, which came from the categorized credit card purchase from Marshalls, that Seller Ledger knows the total amount for the transaction that got imported from the credit card. As you add items and cost informations, the bottom of the screen will let you know how much of the purchase has been allocated.


  1. If you have other costs tied to this purchase (such as sales tax, inbound shipping, handling fees, etc, click the link to Add other costs.

Notice how the Total amount for the individual items changes when you add other costs. Seller Ledger automatically allocates these "other costs" to the inventory items to ensure cost of goods sold is properly calculated. To learn more about "other costs" and cogs, read our blog post on the topic.

  1. Click Save purchase.

If you have a large purchase and need to step away, Seller Ledger will save your progress and remember the remaining amount so you can come back later.


Option 2: Upload a receipt

If you have a photo or PDF of the receipt from your supplier, you can upload it and let Seller Ledger help extract the item details.


  1. In the How do you want to add items? selection list, choose the Upload receipt option.

  1. Drag and drop the receipt file from your computer, or click choose a file to select a file.
  2. Seller Ledger will read the receipt and pre-fill the product name, quantity, and cost information for each line item.
  3. Review the extracted details, make any corrections, and click Save.

Note: most retail receipts provide internal names on their receipts, rather than actual product names/descriptions, so you will likely want to edit the product names that get pre-populated from the parsed receipt file.


Option 3: Upload a CSV file

If you have your item information in a spreadsheet — for example, an order confirmation from a wholesaler or a list you've been maintaining yourself — you can upload it in CSV format.


  1. In the Add details view, choose the Upload Inventory option.
  2. Make sure your CSV file has the following four columns, in this order:
    • sku
    • product name
    • quantity
    • total cost
  3. Drag and drop the receipt file from your computer, or click choose a file to select a file.

  1. Click Upload and parse CSV.

After a few moments, Seller Ledger will load the inventory details from the CSV file to explain the purchase total. If you notice any errors in the data that you uploaded, you can correct it here before saving.

  1. Click Save Purchase.

A few tips for the CSV format:


  • The total cost should be the total amount for all items in that row. Seller Ledger will calculate the per-unit cost automatically.
  • Do not include commas in your quantity or cost values (e.g., write 1000       , not 1,000       ).
  • The column headers must match exactly.

For more detail on CSV inventory uploads, see Can I upload my inventory items?


About "other costs" and how they get distributed

When you purchase inventory, the total cost of the purchase often includes more than just the items themselves. Things like shipping charges, taxes, customs fees, or handling charges are all part of what you actually paid — and they should be included in the cost basis of the items you bought.


Seller Ledger handles this automatically by distributing those "other costs" across the items in the purchase.


Here's how it works:


  • When you record item details, the sum of your item line costs may not equal the total of the original purchase transaction. The difference — the "other costs" — represents things like shipping, taxes, or fees paid to the vendor.
  • Seller Ledger takes that leftover amount and distributes it proportionally across the items in the purchase, based on each item's share of the total item cost.
  • This means the unit cost we use for each item (and later, for cost of goods sold when the item sells) reflects the true landed cost, not just the sticker price.

To see an example of how this works, check out our blog post on other cost and cost of goods sold.


What happens after you record item details

Once you've saved item details for a purchase:


  • Those items appear in your Inventory → In Stock view, ready to be matched to sales.
  • When a matching sale comes in from a connected marketplace, Seller Ledger will automatically reduce your inventory quantity and record the cost of goods sold — no extra work needed on your part.
  • You'll be able to see gross profit on each order and item sold.

For more on how sales get matched to inventory, see What is "continuous" inventory tracking?


Frequently asked questions

What if I only enter details for some of the items in a purchase?


That's fine. Seller Ledger will save your progress and show the remaining unallocated amount, so you can come back later to finish. Until you allocate the full purchase amount, that remaining balance will just sit in your Inventory asset account.


Can I edit item details after I save them?


Yes. Just find the purchase under Inventory → Purchases and click into it to edit.


What if my receipt upload doesn't extract everything correctly?


You can always adjust any of the fields Seller Ledger pre-fills from a receipt before saving. If the receipt is unclear or the results aren't accurate, you can also fall back to manual entry or a CSV upload.


Do I need to enter SKUs?


SKUs are optional, but strongly recommended. They're the most reliable way for Seller Ledger to automatically match your inventory to sales from connected marketplaces. If you don't enter SKUs, we'll fall back to matching by product name, which is less reliable.


If you have any questions about recording inventory purchases or aren't sure which method is best for your situation, feel free to reach out at [email protected].

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