Do i change the cost price of a product when it goes up in price

@a-mblanchard @Anonymous 

NO, not really. You can change the cost price but the data is only for creating Vendor Purchase Orders.

Actual FIFO cost counts when you buy products and enter it under Vendor Item details tab either as a Bill or Check or Expense form.  That,s all you need to do. QBO will take care of the COGS side when you can create a Sales form (invoice or sales receipt).

QB online: Would this change past invoices? I do not want my profitability to be wrong. ALSO can I change the selling price without changing past invoices?

Hello djskev,

You're right on track! Changing your cost price and selling price won't affect past invoices or purchase orders. This adjustment will only affect the transactions moving forward.

I know how important it is to have an accurate profitability report, so I'm glad you reached out to clarify this. 

If you've got any other questions about inventory, let me know.

Have a great day.

I am confused about why I wouldn't change the cogs of items when they cost me more or less....when I place an order, I want to make sure that the price is correct when I get the bill.....is ther a reason NOT to change the cogs on the POS when they change?  Also...how can I change them in bulk...and not have to go into every style, size, color etc to change the price?

Thanks,

Jeannie

Thanks for contributing to the discussion. I recommend consulting your accountant for the best advice on when to change the price of your goods in QuickBooks. They'll be best equipped to help you ensure that your bookkeeping is all done correctly to reflect the appropriate prices at the right time. 

While you're unable to change the cogs in bulk at this time, you can individually edit them easily by following these steps:

1. Select Sales.
2. Select Products and Services.
3. Locate the product you wish to edit.
4. Select Edit under the Action column.
5. Change the cost amount.
6. Select Save and close.

If you have any other questions, let me know. 

Cheers!

We would like to track our inventory in QuickBooks Online (QBO), but purchase our products from multiple vendors with different pricing. The amounts we purchase from each vendor varies by day. Is there a way to have QBO calculate the average cost from purchase entries and then automatically update the Cost on the Product, so it is accurate for Sales? With our volume of purchases, to do the calculation and update manually would be time prohibitive, and if not done perfectly, we might end up with a positive or negative dollar amount in inventory when the quantity is zero rather than $0 as it should be.

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@jjakobovic wrote:

We would like to track our inventory in QuickBooks Online (QBO), but purchase our products from multiple vendors with different pricing. The amounts we purchase from each vendor varies by day. Is there a way to have QBO calculate the average cost from purchase entries and then automatically update the Cost on the Product, so it is accurate for Sales? With our volume of purchases, to do the calculation and update manually would be time prohibitive, and if not done perfectly, we might end up with a positive or negative dollar amount in inventory when the quantity is zero rather than $0 as it should be.

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@jjakobovic 

First of all, there is no need for you to change the COST field on the Product/Service Information page. This cost price is primarily used when creating Purchase Order, the same way the Sales price/rate field used for Sales Invoices and Receipts. 

So, this is exactly what QBO inventory tracking will do. It makes no difference in QBO if you are buying from multiple vendors and at various prices. That's what you would normally do in business anyway.

Just run the "Inventory Valuation Summary" report and you will see Calculated Average, Asset Value, and Inventory Quantity on Hand, and so on. You can also run the Inventory Valuation Detail report for more detailed information.

In QBO, you've FIFO inventory accounting. If you need to learn how it will calculate the COGS when you sell inventory items to the customers, read this article.

https://quickbooks.intuit.com/learn-support/en-uk/help-articles/what-is-fifo-and-how-is-it-used-for-...

Hope this helps!

Is there anyway to update the COGS values of invoices when updating a products cost?

I just noticed that, for all of 2019, one of my best selling products had the purchase cost set INCORRECTLY and it's totally throwing off my year end numbers.  I have since updated the product purchase cost but the COGS have not updated and thus gross profit is still very wrong.

Is my only option to delete all my invoices from 2019 and re-enter?  That would be a nightmare

I used to use Quickbooks Plus, there I had a field to add the cost of an item.  I just changed to Quickbook essentials and now there is NO field for me to add it. 

I'm quite confused,  I can understand not allowing me to have inventory with Quickbooks Essentials,  but the cost of an item is so fundamental,  I find it difficult to think I can not do it in Quickbooks Essentials. 

Hi Addie -

So if I use QB for rental properties, address is listed as an "item" and we have just increased our rent price this will not affect previous rental invoices & pmts?

Thank you,

H

I have a very large item list. Changing each item price can be quite a lot of work. Any work around?

Hi everyone. Thanks for continuing the discussion. As for your question BOSSbert, you're right! Making these kinds of changes won't impact previous transactions. 

ZeeShan Ayub, I can appreciate that this process may take quite a while depending on how lengthy your item list is. I know how valuable your time is.

At this time, each item will have to be manually edited one-by-one. I'd be happy to pass on your feedback about this to my team, and I'd suggest you do the same on your end. You can do that by clicking the Gear icon > Feedback.

I hope this helps clear things up! If either of you have any other questions, please don't hesitate to reach out to our tech support team. 

Cheers.

Where is this "Inventory Valuation Summary" report?

Also, is there a way to manually reduce inventory asset?

I don't get items at a fixed price. It is all assembled from various inventory items.

Hi tonjunee,

In my QuickBooks Online Advanced version, the "Inventory Valuation Summary" report is a standard report under Sales and customers or you can find it by typing the name in the report or main search bar. FYI, there is also an Inventory Valuation Detail report.

If you need to reduce the quantity of your inventory, you can do that with an Inventory qty adjustment entry. To find that, click on the + New button and look under OTHER. If you reduce your inventory this way, it will credit the asset account the same way it credits for sales based on FIFO (first in first out) purchase prices. You can choose which account you want debited as an offset. If you increase your inventory this way, QBO uses the last purchase rate to calculate the value of the increase.

Hi @jjakobovic 

Before I try this out and mess up the accounts again, what if I didn't set up the inventory before hand?

Now when I go to use "qty adjustment entry", I am prompted to create a product to record the sale.

But shouldn't I have had a product set up already before to help reduce this inventory properly? Or is it not necessary and I can still make a product at the "qty adjustment entry" at a late stage?

It's not typical to adjust the inventory of a product you haven't yet created, but QBO will allow you to create an inventory product and then immediately adjust it. Not knowing exactly what you are trying to do, I'm not sure how to advise you beyond that.

If you want to try things out without messing up your books, I'd recommend signing up for a free developer account. That gives you access to up to 5 "sandboxes", basically dummy company files that you can try things out in. After I asked my initial question and got the first answers, this is what I did to see how it all worked before actually using it in my live books.

Here is more information on QBO sandboxes:

https://developer.intuit.com/app/developer/qbo/docs/develop/sandboxes#launch-a-sandbox

In the top right corner of that page is a link to sign up for a developer account too.

@jjakobovicGreat!

Thank you. I'll be sure to check out the developer account. I think that is the best approach to take.

Right now the products are assembled from different sources so I have to manually decrease inventory at the moment until I figure out a better method of compiling COGS.

Does QBO only allow for FIFO costing method or we have the option to change it to average costing and if yes, how?

Hi there Kaukab5, 

Thanks for joining the discussion here in the Community. I'd be happy to clear this up for you. 

At this time, QuickBooks Online can only be structured using the FIFO (first in, first out) costing method for inventory. QuickBooks Online will always consider the first units purchased (First In) to be the first units sold (First Out) and will adjust your assets and Cost of Goods Sold (COGS) accordingly whenever sales of inventory items are entered.

Here's more information about that: What is FIFO and how is it used for inventory cost accounting?

At this time, this method of inventory tracking can't be adjusted. I can appreciate that you may wish to use a different method to track your inventory, and I'd encourage you to reach out to our product development team with your suggestions. You can do that by clicking the Gear icon > Feedback. 

If you have further questions about this, please don't hesitate to reach out to our tech support team. 

Cheers. 

Hello

I was able to add the cost heading in the list of products and services but when I click on an individual product, I cannot seem to be able to add the cost for that item.  This option is not there in the right hand side window that opens up for each product during editing.

Please help.  Thanks

Kine

Hi 

I have entered bills from vendor ,but when I check the item it does not show cost as being updated from the bills . What could be the issue .

Thanks 

Zaheer 

Hi there. Thanks for taking the time to chime in on this thread. QuickBooks is the go to program when it comes to streamlining the way you manage your products and services. I'll be happy to share more info on this. In order to edit the cost of product/services, follow the steps below: 

1. Click the Sales tab, then select Products/Services.
2. Click Edit next to your item.
3. Manually adjust the cost, then click Save and Close. 

If you're having issues, I recommend clearing cache and cookies as you may be experiencing browser issues. Clearing cache and cookies is a great way to clean your browser allowing it to work more efficiently. Here's an article which shows you how to do that: How to clear cache and cookies. If this doesn't work, I suggest using a private/incognito window to see if that works instead. Try this out and let me know what happens. 

I encourage you to try this out and let me know how you make out. I'll be one message away in case you need anything else. :)