Quickbooks Inventory

You can use Quickbooks Inventory to track items you keep and sell. Quickbooks can help you manage the items you stock and resell. It can track how many quantities are available or on hand, track the income and track cost of goods sold.

You need to make sure that you've done a physical count on your inventory items before setting them up to Quickbooks. This will help you get the accurate count and value of each item.

You have to turn on the Quickbooks Inventory preference first before you can create an inventory item. To turn on the preference:

  1. In your Quickbooks, click Edit menu then click Preferences.

Edit Preferences

  1. Click Items & Inventory > click Company Preferences tab > place a check mark next to Inventory and purchase orders are active then click OK to turn on this preference.

Inventory Preferences

Now that you have turned on the Quickbooks inventory preference, you are now ready to create the inventory item.

Here are the steps to create Quickbooks inventory item:

  1. Go to Home Page then click Items & Services.

Item Home Page

  1. Click the Item button then click New.

New Item Button

  1. The New Item window appears. Fill out the information and click OK to create the item. Click here to know more about setting up Quickbooks Inventory item.

New Inventory Item

General information when setting up inventory item.

  1. Select Inventory Part from the Type drop-down list.

Inventory Type List

  1. Enter the name of this inventory item in the Item/Name Number field. This is the name displayed when you enter sale or purchase transactions.

Inventory Item/Name Number

  1. (Optional) Check the Subitem of box and select from the drop-down list another item if you want this item to be a child of another item. Select this if you want to create a hierarchy of items.

Inventory Subitem of

  1. (Optional) Enter the Manufacturer part number if you know it in the Manufacturer Part Number field. This is just for additional information for the item that you are creating.

Inventory Manufacturer Part Number

  1. (Optional) Select the unit of measure that you want to use for this item. Click the link to know more about the unit of measure.

Inventory Unit of Measure

  1. In the Purchase Information section where you enter the description, cost, COGS account and preferred vendor of this item.
  2. Purchase Information

  • (Optional) Description on Purchase Transactions - you can enter here the purchase description that you want to appear on purchase transactions (i.e. Bills, Purchase Order, etc).

  • (Optional) Cost - enter here the last amount you paid for this item or the amount you expect to pay when you next buy it.
  • COGS Account - you can select a different COGS account if you are using other account other than the one that is preselected. This account is being used to track how much you paid for this item.
  • (Optional) Preferred Vendor - select the vendor where you usually buy this item from. The preferred vendor you select here appears on the Inventory Stock Status by Item report and on the Physical Inventory Worksheet.
  1. In the Sales Information section where you enter the description, sales price and income account.

Sales Information

  • (Optional) Description on Sales Transaction - you can enter here the description that you want to appear on sales transactions (i.e Invoice, Sales Receipts, etc).
  • (Optional) Sales Price - you can enter here the amount on how much you charge for this item.
  • Income Account - select the account where the income from the sale of this item will be recorded.
  1. In the Inventory Information section you enter the Asset Account, Reorder Point, On Hand, Total Value and the As of.

Inventory Information

  • Asset Account - this is the account where you can track the current value of your inventory.
  • (Optional) Reorder Point - enter the number of quantity at which you need to reorder. You can set up Quickbooks to remind you when the quantity reaches the number that you enter on this field.
  • On Hand - enter the number of available quantity you have for this item. Otherwise, enter 0.
  • Total Value - this is the cost multiplied by the on hand you enter for this item. Quickbooks automatically computes for this field.