Step-by-Step Setup Checklist for Shopify and QuickBooks Online

1. Choose the appropriate QuickBooks plan: Make sure inventory tracking is supported (QBO Plus or Advanced).
2. Set up your Chart of Accounts (CoA): Use the structure suggested above or adapt it for your business.
3. Enable inventory tracking: In QuickBooks (or via a connector) and set your valuation method (FIFO or Average Cost).
4. Connect Shopify to QuickBooks: Via native integration or third-party connector so that:
   • Sales from Shopify post to “Online Sales – Shopify”.
   • Shopify fees and post-sales adjustments map to “Payment Processor Fees” or a similar account.
   • Inventory movements update “Inventory – On Hand” and “COGS – Product Cost” correctly.
5. Set up bank and merchant accounts: Ensure Shopify payouts or bank deposits reconcile in QuickBooks.
6. Month-end procedures:
   • Reconcile your bank account(s) in QuickBooks.
   • Review inventory counts and compare Shopify vs QuickBooks.
   • Run a Profit & Loss (P&L) and Balance Sheet report; check for unusual balances or discrepancies.
7. Adjust and refine: As your e-commerce business evolves (new products, returns, multi-channel sales), refine your accounts, integrations, and tracking logic.