You need at least one each of the following types of accounts in your chart of accounts to track inventory.
Suggested Name | Account type/comments |
---|---|
Inventory value | Other Current Asset Use this account to track the current value of your inventory. If you want, you can set up subaccounts within this account to track the value of different types of inventory. |
Sales | Income Use this account to track the income from the resale of inventory items. If you want, you can set up subaccounts within this account to track the income from different types of inventory. |
Cost of goods sold | Cost of Goods Sold Use this account to track the cost to you of the items you have sold. If you want, you can set up subaccounts within this account to track the costs for different types of inventory sold. On a profit and loss report, QuickBooks subtracts the total cost of goods sold from your total income to provide a gross profit before expenses. |