Creating items for inventory

Use inventory part items to represent materials or parts you buy, track as inventory, and then resell. You can keep track of how many items remain in stock after a sale, how many items you have on order, your cost of goods sold, and the value of your inventory.

To create items for inventory:

  1. Choose Lists > Items.
  2. Click the + at the bottom of the list.
    Add
  3. Choose Inventory Part from the Type pop-up menu.

    If Inventory Part isn't on the list, you need to turn inventory tracking on. Choose QuickBooks > Preferences and then click Inventory. Select the “Inventory and purchase orders are active” checkbox.

  4. Enter an item name or number.

    You may use letters or numbers, up to a maximum of 31 characters. The item name you enter here appears on the Item list you choose from while entering a sale or purchase. It prints on invoices, sales receipts, estimates, or purchase orders only if you print Item columns.

  5. Fill in the Purchase Information fields.

    QuickBooks uses the purchase cost and purchase description you enter here on purchase orders, and checks, credit cards, and bills you use to pay for this item.

    • Description on Purchase Transactions: What you enter here appears in the Description column of checks, bills, credit card charges, and item receipts when you reorder the item. Your description may be up to three lines in length. You can edit the description when you are filling out a purchase order.
    • Cost: Enter the cost you expect to pay when you order or buy this item. You can change the cost at the time you purchase the item.
    • COGS Account: Select a different cost of goods sold account if you don't want to use the preset account. The type of this account should be “Cost of Goods Sold.” QuickBooks calculates the cost by using the average cost of the items in stock at the time of sale.
    • Preferred Vendor: Enter the name of your preferred vendor for this item. This information appears on the stock status report and the physical inventory worksheet.
  6. Fill in the Sales Information you show to customers.

    QuickBooks uses the sales description and sales price on invoices, cash sales, and credit memos relating to this item.

    • Description on Sales Transactions: You can edit the description on any sales form.
    • Sales Price: If your sales price varies, you can leave the field blank.
    • Taxable: Select this checkbox if you charge sales tax for the item. When you make a taxable sale, QuickBooks will calculate tax on the item.
    • Income Account: Enter the name of the income account you want QuickBooks to use to track the income you earn from sales of this item.
  7. Fill in the Inventory Information for easy reordering of stock.
    • Asset Account: Select a different inventory asset account if you don't want to use the default account. If you use the same account for all your inventory items, the balance of this account will show the total value of all your inventory at any one time.
    • Reorder Point: Enter the quantity at which you want QuickBooks to remind you to reorder this item. This information also appears on the stock status report.
    • Qty on Hand and Total Value:
      • If this is a new item that you are adding to your inventory, leave the quantity-on-hand and value at zero.
      • If this is an item you already have in stock, enter the quantity-on-hand and value as of the last time you measured your inventory. Then, be sure to enter any sales or purchases of the item that occurred between the date you measured your inventory and today. This ensures that QuickBooks' record of your quantity-on-hand for the item will be accurate.
      • If this is an item you are converting to an inventory part item from a non-inventory part, service, or other charge item, the date you enter must be a date that is after the date of the last transaction that uses the item.
    • As of: It's best to use today's date. If you're converting this item from a different type of item, you must use today's date for accurate records. If you use your start date or any date in the past, you'll need to enter all purchases and sales of this item up to today in order for your quantity on hand and value to be correct.
  8. (Optional) Fill in any custom fields that apply to this item. More info
  9. To mark an item as inactive, select the Inactive checkbox. More info

Asset

Your company assets are the things that your company owns.

QuickBooks distinguishes between two types of assets: