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Anonymous
Not applicable

How can I allocate freight costs to the inventory items purchased?

Hi, can someone please explain me step by step (entry by entry)  how to allocate freight costs to the inventory items purchased.

 

I buy inventory for one supplier and then ask my forwarder to ship the inventory for me, so there are two bills - one from the supplier and one from the forwarder. I would like to allocate the freight as the cost of goods sold, not the expense. 

 

If someone could give me the list of entries that I need to do that would be a huge help! I have found Mr. Rustler explanations but it's unclear to me. I had a 10 years break from QB and I need very detailed explanation :)

 

Thank you in advance!

 

Solved
Best answer April 21, 2019

Best Answers
Rustler
Level 15

How can I allocate freight costs to the inventory items purchased?

enter the bill for the receipt of the items as you normally would

 

when the freight bill comes in, enter it and use an expense account called clearing expense, create it if you need to first

 

then edit the first bill, for each item increase the total cost by a portion of the freight amount, then change to the account details portion and select the clearing expense account, enter the amount of that bill as a negative number

 

insure the original amount of the bill has not changed and save, click through any warnings about payments being applied if you get them

View solution in original post

Catherine_B
QuickBooks Team

How can I allocate freight costs to the inventory items purchased?

Thanks for getting back, Gosia. 

 

Yes, you'll have to enter the freight bill as a bill. After, follow the steps above given by Rustler, with regards to the account you'll use. 

 

Let us know if you have other concerns. We'll be around to help you. 

View solution in original post

4 Comments
Rustler
Level 15

How can I allocate freight costs to the inventory items purchased?

enter the bill for the receipt of the items as you normally would

 

when the freight bill comes in, enter it and use an expense account called clearing expense, create it if you need to first

 

then edit the first bill, for each item increase the total cost by a portion of the freight amount, then change to the account details portion and select the clearing expense account, enter the amount of that bill as a negative number

 

insure the original amount of the bill has not changed and save, click through any warnings about payments being applied if you get them

View solution in original post

Anonymous
Not applicable

How can I allocate freight costs to the inventory items purchased?

Thank you for your reply Rusler. However, I have an additional question regarding the freight bill...

Do I enter the freight bill as a bill or journal entry?

 

Thank you!

Gosia

Catherine_B
QuickBooks Team

How can I allocate freight costs to the inventory items purchased?

Thanks for getting back, Gosia. 

 

Yes, you'll have to enter the freight bill as a bill. After, follow the steps above given by Rustler, with regards to the account you'll use. 

 

Let us know if you have other concerns. We'll be around to help you. 

View solution in original post

Anonymous
Not applicable

How can I allocate freight costs to the inventory items purchased?

Thank you to both of you! I was able to make it done :) Thank you for your help! 

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