Question 1

What is the best accounting software for a hardware or consumer products brand?

Accepted Answer

Physical-goods companies need inventory accounting generic ledgers do not do: perpetual valuation under ASC 330, landed cost capitalized into the unit, COGS relieved on every shipment, and margin at the SKU level. Most brands run a 3PL, supplier invoices, an Excel cost roll, and NetSuite, then true everything up with a quarter-end count. Aleq is an AI accounting platform that is the ledger itself for hardware brands: it maintains raw, WIP, and finished-goods subledgers, rolls freight and duty into unit cost, books COGS with each fulfillment, and reconciles on-hand value to the warehouse nightly. It connects to your warehouse and supplier feeds read-only and is live in 48 hours.

Question 2

What is landed cost and how do you calculate it?

Accepted Answer

Landed cost is the full cost of getting a unit to your warehouse — the goods plus freight, duty, insurance, and broker fees. Calculate it per shipment, then divide by units: for example, $96,000 of goods FOB plus $14,400 freight and duty plus $2,400 broker and insurance is $112,800 across 1,200 units, or $94.00 per unit. If you expense freight instead of capitalizing it, COGS is understated and gross margin overstated by several points. Aleq captures these costs from supplier and customs invoices and capitalizes them into unit cost automatically — before the first unit sells — so reported margin reflects true landed cost, not just the PO price.

Question 3

When should COGS be recorded — at purchase or at sale?

Accepted Answer

At sale. Purchases go to inventory, an asset; cost moves to COGS only when the unit ships, matched to the revenue it earned. Recording purchases straight to COGS makes margin swing with buying cycles instead of sales. Aleq books this atomically: each fulfillment relieves inventory and recognizes COGS in the same entry, at true landed cost, consuming FIFO layers or weighted-average cost per your policy. Returns reverse the entry and re-value the restocked unit. Gross margin by SKU, channel, and period is then derived straight from the ledger, current to the last shipment.

Question 4

Why doesn't my inventory balance match my accounting system?

Accepted Answer

Usually because the warehouse and the general ledger update on different clocks: freight and duty invoices land weeks after the goods, standard costs drift from actuals, and returns re-add inventory nobody revalues — so by month-end, on-hand value, COGS, and the GL disagree and get patched with a quarter-end physical count. Aleq keeps a perpetual inventory subledger — raw materials, WIP, and finished goods — that reconciles to your warehouse feeds nightly and ties to the general ledger at $0.00 variance, with lower-of-cost-or-NRV write-downs posted automatically instead of discovered at the count.

Question 5

How do you account for customer returns of physical goods?

Accepted Answer

A return has two sides. The revenue side — the refund — is the part most systems handle. The inventory side is where books go wrong: the unit comes back into stock and must re-enter inventory at an appropriate value, or restocked goods silently reappear at stale costs and distort margin. In Aleq, a return reverses the original COGS entry and re-values the restocked unit in the same motion, so the perpetual subledger stays true and gross margin by SKU survives the return cycle intact — no month-end sweep of unmatched restocks required.

Question 6

What is purchase price variance and why does it matter?

Accepted Answer

Purchase price variance (PPV) is the gap between the standard cost you set for a part and what the vendor actually billed. Left unmanaged, it gets buried in COGS, and you cannot tell whether your costing model drifted or your supplier raised prices. Aleq runs standard costing with variances isolated: purchase-price and usage variances against standard are posted to their own accounts and reported, so you see exactly where the model and the warehouse diverge. The costing method election — weighted-average or FIFO — remains your policy; Aleq stages the cost layers either way and applies your choice consistently.

Every shipment moves inventory. Aleq is the ledger that moves with it.

On-hand value, COGS, and the GL disagree by month-end.

A container lands. The cost rolls into the unit.

The books for hardware & physical goods, run for you.

And it runs the rest of your close, too.

It speaks your accounting natively.

Questions, answered.

Closing on a quarter-end inventory estimate?