How to classify credit card inventory purchases?

Yes but I believe her question was... or at least mine is... 

when classifying that inventory purchase, where in the chart of accounts does it get assigned?  Cost of Goods sold?  Inventory asset? 

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@marylanai wrote:

Yes but I believe her question was... or at least mine is... 

 

when classifying that inventory purchase, where in the chart of accounts does it get assigned?  Cost of Goods sold?  Inventory asset? 

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Depends, if you have a subscription to QBO Plus, then you have inventory type items and should use them.

In company settings,  turn on qty tracking (inventory)
and
in company settings you also turn on the items table and purchase orders.

Then when you enter an expense or bill, about half way down the left side is a title "item Details" click that and a table opens where you can select the item, qty and item total cost for purchasing inventory

You can not, not purchase inventory type items from a bank feed.

The workflow is, and has always been, make entries, download banking, match.

While advertised as a wonderful thing, the transactions dates for entries are wrong if you use banking to make them.  A transaction occurs when you make it, not when it finally clears the bank.

LLC is not a tax type for filing taxes, you are taxed as a sole proprietor, partnership or corporation, and your accounting is governed by that type of business.

Thank you @Rustler.  I did some further research here on the forums into the topic, as i realize that fundamentally I'm struggling to grasp the differences between accounting inventory purchases as either an asset or COGS.  I found several other threads where your replies were very helpful.

(like this one) 

I am just starting my retail business, and chose not to purchase QB with inventory tracking because the POS system I use (lightspeed) has very strong inventory mgmt capabilities.  I was beginning to think I will be forced to upgrade my QB, but it sounds like as long as my POS enters sales accurately, I can get by.

This post  was quite helpful --(which by the way I am mostly recording for my own reference later! -- or in the case that someone else with a retail shop is wondering the same thing)

thanks again. 

This is an old post, but it popped up because of some background changes.  To answer @marylanai inventory purchased is eventuay BOTH an asset and COGS.

When an inventory item is purchased it becomes an Other Current Asset, you have zero expense until you sell it. When you sell, and record income, is when it is posted to COGS (Cost of Goods Sold), until you sell you have no cost

I have been reading this thread and I think it answers a problem we are having.  Can someone please clarify.  We buy products and sell them, so in reality we should be coding the purchase to other assets so it doesn't hit COG when we receive the items into inventory.  Then when sold it will hit the cog.  Am I understanding this correctly .  Right now we are double dipping on expenses each month.  We make purchases and have that coded to a COG account-- then with advance inventory turned on, it is hitting the COG at time of sale.   Am I understanding this correct we should change the purchase to other asset inventory

@john-pero , what do you mean I have zero expense until I sell it?  I have an expense because I bought the item for inventory, I paid someone for something or I wouldn't have it in inventory, correct?