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in P & L report Purchase amount different from what I really paid.

I don't understand and figure out what amount is the "0.23" in the journal entry.

 

I purchased the amount $60 but in P&L report shows me the amount 0.23.

 

Can somebody explain what amount it is?

Thank you

2 Comments
QuickBooks Team

Re: in P & L report Purchase amount different from what I really paid.

Hello,


Understanding the financial reports is important for managing your business. I'll gladly help with this. QuickBooks Online offers an extensive list of reports so you can stay on top of things. If a report is not displaying correctly, I suggest clearing the browser's cache and cookies by following the steps in this community article: https://community.intuit.com/articles/1771580-how-do-i-clear-my-browser-cache-and-temporary-internet.... This process will remove old internet data that can interfere with the website proper loading and display.


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Let me know if you have any other questions.
 

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Re: in P & L report Purchase amount different from what I really paid.

Hello @jinjin ,

 

This number has to do with your inventory valuation.  It looks like you are not purchasing directly into your cost of sales (Purchases) account; when you purchase an item, it goes into inventory and the JE looks like this:

 

DR Inventory                    (Balance Sheet)

CR Accounts Payable     (Balance Sheet)

 

This entry does not affect your P & L; only the balance sheet.  Your P & L is affected only when you sell that item.  See below.

 

CR Inventory                    (Balance Sheet)

DR Purchases                   (P & L)

 

QB uses an average price valuation for that item, based on the history of each time you purchased it.

 

For whatever reason, when you sold the item you had previously purchased, it only had an inventory value of $.23 on the books, thus the entry you see and the cost you see on the P & L.  You will have to look at how you are handling your inventory, find the item that was purchased and sold and look at the history.  Check to see that you have your inventory items and accounts set up properly.  Here is a good resource to explain how the inventory in QB works.

 

http://www.numbercruncher.com/WebHelp/AO4/How_does_QuickBooks_handle_Inventory.htm

 

Good luck.