Hi Jenae85,
I can share a bit of information about inventory setup in QuickBooks.
How exactly did you enter your raw materials in QuickBooks Online? Once you set up your first inventory item, the program automatically adds two accounts to your Chart of Accounts.
They are the Inventory Asset (Other Current Asset) and Cost of Goods Sold. Generally, COGS is affected only when you sell the items. This account isn’t meant for the items you use to create your products, such as raw materials.
For more details about how inventory works in QuickBooks, check out these articles:
If the items you bought are used to run your business or part of your inventories cost, you can record them as expenses. However, for those you buy and resell, you can directly add them to your Products and Services List.
Here’s how:
- Go to the Gear icon at the top then pick Products and Services.
- In the Products and Services window, select New.
- Click the product or service type.
- Enter the new product or service information.
- Choose Save and close.
If you want to replenish these items in the future, you'll have the option to use the Expense or Bill functionalities. Just make sure to use the item details field so you can select which one you need from the list. This way, the program will recognize an increase in volume.
To answer your last concern; yes! You can enter the actual cost so that the program can automatically calculate the COGS amounts upon the sale of your items.
That's it! Don't hesitate to let me know if there's anything else you need help with. I'm here to help anytime.
