I have read some of the posts on Consignments. I do understand that Consignment Items are NOT owned by me, however I also need the ability to track their inventory within Quickbooks. Would not the following be a viable option: Company ABC is dis-continuing inventory and would like to "Consign" inventory to us to sell for them. At the time of sale, 50% of sales price goes back to the company that gave us the goods. Is the following work flow acceptable: #1 - Inventory Items created with $0 Average cost, COGS Account created for "Purchases ABC", Income Account created for "Sales ABC" Each individual item is created and tied to these accounts. #2 - At the end of the quarter, report run showing all sales of income account "Sales ABC" #3 - Company ABC invoices my company for 50% of the sales. #4 - We pay the invoice and under expenses on the check select "Parts Purchases ABC" Because we are using 0.00 Average cost, it shouldn't impact our inventory asset accounts? We are trying to accomplish the following: Track the items and quantity (Hence why we are using inventory items), only pay for the items that are sold, when they are sold. (or quarterly). Make sure that these items do NOT impact our books for anything other than when they are sold, and the consignment payment is made. What am I missing? We really need to be able to track the inventory of the items within quickbooks because it is integrated into our sales channels/webstores. Any insight would be appreciated.
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Scenario #1 - I am aware of the problems of showing Negative Inventory in quickbooks. However, does it still create problems if that Negative inventory is on items with a $0.00 average cost? Example: employee cleaning out 40 year old facility and finds aproximately100 widgets. Inventory item is created with $0.00 average cost. ($0 Average cost because there is no expense or records to be found.) Inventory is sold, and at the end of the year we show sales of 150 widgets sold. (Negative inventory of 50 showing.) At the end of year inventory, is there any problem making an inventory adjustment to quantity on hand and zeroing out that negative inventory. I realize all 150 units sold are showing as 100% profit, as they should, as there was no cost. My question is: am I creating problems or issues within quickbooks by doing this?
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