Accountant for Maple Ridge manufacturers

For a one-owner Maple Ridge manufacturer, monthly bookkeeping, payroll and the year-end T2 with statements usually cost from $500 to $700 a month all-in.

Inventory is a tax number, not just a stock number

Year-end inventory directly affects profit, because cost of goods sold comes from opening stock, purchases and closing stock. Value closing inventory too high and you overstate profit; too low and you understate it, which attracts attention. For a fabricator holding steel, components and finished units, the count and valuation basis matter as much as sales. Our inventory accounting guide sets out the approaches.

Work in progress: the part that is neither

Production businesses always hold part-finished value — material issued, labour applied, nothing sold. It belongs on the balance sheet, not expensed as incurred. Expensing everything understates assets and distorts the year, especially when a large job straddles year-end. A consistent WIP basis is high-value first-year work and makes every later year easier to close.

Equipment, and the machine you eventually replace

Machinery, tooling and fit-out are recovered through capital cost allowance at class rates. The half-year rule halves the first claim; the Accelerated Investment Incentive suspends it for eligible property, allowing a larger first-year deduction.

Shops often miss the sale. Proceeds are compared with the undepreciated capital cost in the class, and excess depreciation returns to income as recapture — fully taxable in the year of sale, trade-ins included.

Costing a job properly, before you quote it

Here the accounting and commercial questions are one. If material, labour and overhead are not attributed to jobs consistently, your product-line margin is a guess, and quoting off a guess makes a busy year thin. Getting costing right serves the return and pricing at once.

Sales tax on what you make and what you buy

Manufacturing inputs, machinery and finished goods are treated differently under BC’s provincial sales tax, and some production inputs differ from general purchases. With GST on both sides, a shop can pay tax it need not and miss tax it should collect. It is routine, but worth setting up correctly once.

Selling to larger customers

Supplying a larger customer changes a production business more than the order suggests. Terms stretch, purchase orders and paperwork arrive, and the customer may want financial statements first.

For most owner-managed shops the answer is a compilation engagement under CSRS 4200: statements with a compilation engagement report and a note on the basis of accounting. It is not an audit or a review, and the report says so; it provides no assurance. If a customer requires assurance, that is a different engagement, and we will say so plainly.

Cash matters too. Longer terms mean financing production longer, so a growing order book can squeeze cash just as the tax on a strong year arrives. Plan for it in advance.

What EverStone handles for you

One CPA, one fixed fee agreed up front:

• T2 corporate return and year-end financial statements
• Inventory valuation basis set and applied consistently
• Work in progress established and carried properly
• Equipment CCA schedules, disposals and recapture
• GST and PST treatment on inputs and output
• Job costing structured so margins are real numbers
• Salary-versus-dividend planning each year

Fixed fees, fully online

Every engagement runs online by video, phone and secure upload, so nobody leaves the shop. The fee is fixed first, so a call before a machine purchase costs nothing extra. See what it costs.

Remote accounting for manufacturers

EverStone is a fully virtual, one-CPA firm. There is no Maple Ridge office and no local staff. Meetings are by video or phone, documents by secure email and e-signature. Inventory and capital costs are tracked all year.