When you are setting up your inventory in QuickBooks you have to have the right preference turned on so that Inventory and Purchase orders are active. This setting is not set by default so you have to go in and change it. The video below will demonstrate how this is done.
Once you have Inventory and purchase orders active in QuickBooks you can begin adding Items to your item list. Your items are your products. What you sell for a living. When we sell an item that we need to track as inventory this is called an inventory part in QuickBooks. Inventory parts need to have 3 accounts associated with them;
- An Asset Account (usually called Inventory Asset)
- A Cost Of Goods Sold Account (usually called Cost of Goods Sold)
- An Income Account (this can be anything you want, often called merchandise sales, or product sales, or just plain.. Sales
Once you know how to set these items up you can begin receiving items into inventory and then you can sell them. That’s what the next few videos will be looking at.