How do i set up COST OF GOODS in products and services

Good day, userinfo86.

Cost of Good Sold is set up as an account in Chart of Accounts instead of an item in Products and Services. I'd be happy to  guide you through the steps on how to set this up:

First, create an account to track your inventory value.

1. Go to the Gear icon at the top, then Chart of Accounts.
2. Select New.
3. Choose Current assets from the Account Type drop-down.
4. Select Other current assets from the Detail Type drop-down.
5. Click Save and Close.

Then, create an account to track your cost of goods sold. I'll show you how below:

1. Go to the Gear icon at the top, then Chart of Accounts.
2. Select + New.
3. Choose Cost of Goods Sold from the Account Type drop-down.
4. Select the closest type of Cost of Goods Sold that matches your situation from the Detail Type drop-down. If you're not sure, use Other Costs of Service - COS.
5. Click Save and Close.

Learn more about the process mentioned by visiting this article: Can I track inventory manually in QuickBooks Online?

Also, you are correct when you say COGS automatically calculates once you issue an invoice or sales memo. Learn more about how QBO calculates COGS through this article: Cost of goods sold: How to calculate and record COGS.

If you're trying to set up a COGS account to an inventory item, then you can add it under the Expense account. To do this, create an item by following the steps below:

1. Go to Sales and choose Products and Services.
2. Click New.
3. Select your preferred Product/Service information.
4. Fill in the necessary information and make sure to choose COGS under the Expense account.
   
5. Click Save and close.

To give more information about managing inventory and what reports are available in QuickBooks Online, check out the following articles:

• Inventory management.
• Use reports to see your sales and inventory status.
  
  

I'll be right here if you have further questions while working with inventory. Keep safe and have a good one.

Hi, userinfo86.

Hope you’re doing great. I wanted to see how everything is going about the setting up COGS you had the other day. Was it resolved? Do you need any additional help or clarification? If you do, just let me know. I’d be happy to help you at any time.

Looking forward to your reply. Have a pleasant day ahead!

shall I enter the cost in foreign currency rate or local currency rate? 

for example, I purchases a pen for cost $1, I will type the cost $1 or 3.67aed in United Arab Emirates Currency?