You state " We purchase items & put into inventory. We are still entering item inventory quantity from end of last year. Due to this we may have an item name but no quantity yet.
Our state requires use tax on removed items.
Owner removes item for personal use. I try to make inventory adjustment"
Just on the above you have various tax questions as to the business COS (tax deductions ) both if Schedule C or Corp tax return filing. not including  also "use tax" to your State.  A full review of you bookkeeping, costing,  financial and tax procedures must be done.