Inventory

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Inventory2014


Topics• QuickBooks Tools for Tracking Inventory• Setting up Inventory Parts Items• Calculating Average Cost of Inventory• Invoicing for Inventory Items• Purchase Orders• Entering Bills for Received Inventory• Adjusting Inventory• Setting up Group Items• Inventory Assemblies• Inventory Reports


QuickBooks Tools for Tracking Inventory



Tracking Inventory with QuickBooks

• Perpetual Inventory• Average Cost method – Not first-in, first-out (FIFO) (Enterprise Only)

– Not last-in, first-out (LIFO)


Activating the Inventory Function


Setting up Inventory Items Parts


Calculating Average Cost of Inventory

• Each time you sell inventory items– The average cost per unit is multiplied by the number of units sold

– This amount is deducted from the Inventory Asset account and added to the Cost of Goods Sold account


Selling Inventory Items

• When you sell inventory, always use an Invoice or a Sales Receipt to record the sale• This ensures that QuickBooks updates your inventory records

and your financial reports at the same time


Purchasing Inventory

• Two ways of purchasing inventory:– Pay for items at the time of purchase using check or credit card

– Use the inventory ordering and receiving process


Purchase Orders

• Use Purchase Orders to track inventory purchases, and to easily determine which items you have on order


Receiving Shipments Against Purchase Orders


Creating Open Purchase Orders Reports

• This report shows the total dollar amount for all open purchase orders, not just the open balance of each Purchase Order


Checking Purchase Order Status•To check the status of a purchase order or to change or cancel it, edit the purchase order directly •The whole PO remains “open” until all items are received


Entering the Final Shipment

• When the final shipment arrives, enter another Item Receipt


Entering Bills for Received Inventory

• Select the Vendors menu and then select Enter Bill for Received Items


Handling Overshipments

• If your vendor ships more than you ordered on a Purchase Order, you have three choices

1. Refuse the extra shipment and send it back without recording anything in QuickBooks

2. Receive the extra shipment into inventory and keep it (and pay for it)

3. Receive the extra shipment into inventory, send it back and record a Bill Credit in QuickBooks


Handling Vendor Overcharges

• If the vendor refunds your money: – Add the refund directly onto your next deposit– Code the deposit to the account and class you used when you

recorded the overcharge on the bill

• If the vendor sends you a credit memo:– Enter a Bill Credit– Code the Bill Credit to the account and class you used when you

recorded the overcharge on the bill


Adjusting Inventory

•QuickBooks adjusts inventory with each purchase or sale of inventory• Inventory can also be manually adjusted in case of:–An increase or

decrease in the value of your inventory on hand–Change quantity of

inventory items


Setting up Group Items

• Group Items allow you to bundle products and/or services on sales forms


Inventory Reports

• Inventory Item QuickReport

• Inventory Stock Status by Item Report

• Inventory Stock Status by Vendor Report

• Inventory Valuation Summary Report


Inventory Item QuickReport

• Generated from the Item List• Report for specific item


Inventory Stock Status by Item Report

• A quick snapshot of each inventory part, and the number of units on hand and on order• Inventory turnover, showing a column for sales per week


Inventory Stock Status by Vendor Report

• Inventory parts on hand and on order• Sorted by the Preferred Vendor field in the item


Inventory Valuation Summary Report

• The value of your inventory items as of a certain date


Summary• QuickBooks Tools for Tracking Inventory• Setting up Inventory Parts Items• Calculating Average Cost of Inventory• Invoicing for Inventory Items• Purchase Orders• Entering Bills for Received Inventory• Adjusting Inventory• Setting up Group Items• Inventory Assemblies• Inventory Reports

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