How Do You Keep Records

I don't deal at all but I would think you would split the purchase price on the items in inventory and separate the shipping cost as business expense in year incurred. In your example, you would have the option of either evenly splitting the purchase price across all 5 coins or allocating the purchase price across the coins as you deem appropriate. If you chose the second option, be prepared to defend an audit with receipts showing per item purchase price or a defendable document showing relative value.

You allocate purchase costs against income from sales on a per item basis as items sell.

As for shipping charges associated with building inventory or to sell inventory, that could be deducted as an operating expense against income in the year it is incurred.

For coins that I buy and sell, I have a composition book where I write down the item, buy price, sold price, dates, profit, and location of where I purchased the item. For multiple items in a lot purchased, I split the cost evenly among the coins, even though it may not be exact numbers. The price paid for an item should include shipping and any fees associated with purchasing that item.

I use all paper, although it can be extremely tedious keeping records that way. I recommend doing your records electronically, especially if you planning on entering in a lot of items. I only flip a handful of items per month so a composition notebook is good enough for me.

A long time ago I used to try keeping track of all my coins, However, as the collection grew and grew, I realized that someday I would need an entire house for all the documentation. That thought was enough for me to stop even trying to keep records of all that stuff.

Exact Change by Wildman Software. Full records and images. Very configuarable. Works great for me.

When I buy a coin, I print out the reciept, then save it as a PDF. Then I enter the data into an excel sheet to keep a compilation of my coin series in one place. BUT before the coin is stored away in an album or 2x2 or a box, I take a photograph of it both sides to document the condition I got it as when it arrived.