Inventory Accounting

Tracking materials, supplies, and inventory items with proper counts and valuations. Know what you have, where it is, and what it cost.

The Challenge

For contractors and tradespeople, inventory means materials scattered across multiple locations. Lumber and fittings in the warehouse. Fixtures on the truck. Specialty items staged at job sites. Everything is constantly moving, and keeping track of it all is harder than it sounds.

Without a system, materials get lost in the shuffle. Something ordered for one job ends up on another. Extra materials come back from a finished project and sit on a shelf for months. Eventually nobody remembers what they cost or which job they came from. You order more of something you already own because nobody checked the warehouse first.

The Tracking

We maintain accurate counts of what you have, where it’s stored, and what it cost. When materials move to a job, we record it. When materials return from a completed project, we update the counts. You get a clear picture of what’s on hand at any given time.

The Valuation

Inventory affects your balance sheet and your taxes. We track costs using proper accounting methods so your financial statements reflect reality. When you need to report inventory value for your CPA or a loan application, the numbers are ready and defensible.

Why This Matters

Cash gets trapped in inventory without you realizing it. You buy $30,000 in materials for upcoming projects. Half gets installed right away. The other half sits in storage for months. If you’re not tracking it, that $15,000 in materials might as well not exist. You’ll order the same items again because you don’t know what you already own.

The bigger problem is job costing accuracy. If materials aren’t tracked properly, your job costs are wrong. You think a project made 20% margin, but $3,000 in materials came from existing inventory without being charged to the job. Real margin was 12%. You bid the next similar project expecting profit that was never there.

Hidden Margin Loss

Materials that disappear or get used without proper allocation eat into profit quietly. Without inventory tracking, you can’t see it happening. You just notice at year-end that margins are lower than expected and you’re not sure why.

Cash Flow Blindness

Money sitting in materials is money you can’t deploy elsewhere. If you don’t know what inventory you’re carrying, you can’t make informed decisions about purchasing or cash management. You might be sitting on $20,000 in materials you forgot about.

What Changes

You gain visibility into what you own. You know what materials are in the warehouse, what’s staged at job sites, and what’s on the trucks. When you need to order, you check inventory first. When materials get used on a project, they get charged to the right job.

Your job costs become accurate because materials are allocated properly. Your balance sheet reflects real inventory value instead of a rough guess. Purchasing decisions are informed by actual usage data instead of memory and guesswork.

Clean Records

Every item tracked, valued, and accounted for. When your CPA asks about inventory at year-end, you have clean documentation ready. When you need a balance sheet for a line of credit, the inventory numbers are accurate and supported by real records.

Smarter Purchasing

You’ll see which materials you turn over quickly and which sit for months. You’ll identify slow-moving items and adjust what you order. The data helps you stop buying materials you already have sitting in the warehouse.

Utah's Construction Bookkeeping Specialists