Inventory Tracking

MRK

I am doing accounting (but not an accountant) for a non profit that purchases prepaid gift cards at a 5% discount and sells them at face value. I want to keep this income separate from other income as all the profit goes to support a Children's Village in Madagascar. I have an asset account for Card Inventory, an income account for Card Sales, and an expense account COGS for Cards Purchased. The purchase price of cards goes in COGS. The sales income goes in Income - Card sales. When cards are sold I do a Journal Transaction that debits COGS and credits Inventory.
1. Should I use the card sales price for the Journal Transaction or the card purchase price?
2. Reports:
a. Cash Flow Report: Card Sales shows only credits for sales. COGS shows only debits for purchases.
b. Balance Sheet Report:
i. Starting Balance of $4,680.75
ii. Credits of $5,182.50
iii. Totals at Ending Balance Debits $0, Credits $5,182.50, Balance -501.75
iv. Balance Change -5,182.50
This doesn't seem right to me. Am I doing something wrong or missing something?
Thanks!

ConnorM

Hey @MRK! That's a great question! While we here at Wave are able to provide technical support, since we aren't accountants, we aren't able to provide accounting advice. While we are able to tell you how to do something in Wave, we aren't able to necessarily tell you the right way of doing it when it comes to the principles of accounting. This one might be better asked somewhere like our 'Find a Wave Pro' section!