cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Community Explorer **

How to job cost supplies that are stored in the warehouse?

I have just acquired a commercial cleaning company and am using quickbooks desktop for it.  When we buy supplies (chemicals, sponges, windex, etc.) we purchase them in bulk from a distributor (usually case quantity).  As regular jobs need to replenish their on-site supplies they requisition them from our warehouse.  The needed supplies are then individually sent to the job site individually.  For example, a single quart bottle of toilet cleaner instead of a whole case.

How do I bring these items in, and then expense them over time to the various job locations as they are consumed?

They're not really inventory items insofar as they are never sold, but we do buy in bulk, hold them, and then distribute as they are needed.

Thanks!

Solved
Best answer 01-25-2019

Accepted Solutions
Established Community Backer ***

Re: How to job cost supplies that are stored in the warehouse?

Never use a JE for inventory in QB.

 

What you asked here: "They're not really inventory items insofar as they are never sold, but we do buy in bulk, hold them, and then distribute as they are needed."

 

Is "Adjust Inventory" and in that screen, top, you assign which Job it gets assigned to, for Relieving it from Stock on hand, but not actually Selling It. That way, you assigned that Cost to the Job and removed it from On Hand.

 

In the job reporting, you will need to remove the Account filter, because you do not want only ordinary income/expense; you want Job reporting to also include COGS.

 

You can see this in my attachment.

5 Comments
Established Community Backer *

Re: How to job cost supplies that are stored in the warehouse?

You essentially have inventory if you want to allocate them to jobs.  The difficult part is setting up the inventory and then setting up the Units of Measurement to convert bulk purchased to unit used.  This a very tedious venture and may not be worth the trouble involved if the cost of the cleaning supplies is not large.  You might be better off expensing the items when purchased and setting up items to invoice for cleaning supply sales. 

 

Example:  You buy 50 bottles of for $50.  Expense them as a cost of goods sold.  You sell the to a customer @ $2 per.  You set up an item for bleach with a sale price of $2.  Include the bleach item on the invoice. 

 

This method will not help you with tracking perpetual inventory.  It is the simplest solution unless you want to micro manage your supply purchases.  At the end of the year you value what is remaining and make a journal entry to inventory. 

Established Community Backer ***

Re: How to job cost supplies that are stored in the warehouse?

Yes they are inventory items, they are "sold" as part of the service you provide if you want to look at it that way.  But in truth inventory is a management system and can be, is, used for any number of reasons

 

stock the bulk goods as inventory items, if you order a case of 12, then set the qty purchased to 12 times the number of cases received

 

then you can "sell" the item to the job, set up the cleaning team as a customer and "sell" to them all at a zero price, that moves the item cost to COGS

or

you can use inventory adjust, set the adjusting account to COGS, an lower the qty

Community Explorer **

Re: How to job cost supplies that are stored in the warehouse?

Thanks.  Is there a way, rather than "selling" the items with a zero amount invoice to the customer, to move the items from inventory to "cogs" as needed with a journal entry?  This would avoid having a stack of zero sum "fake" invoices in each customer's history.  I'm not that great with journal entries though so not sure if this would work.

Established Community Backer ***

Re: How to job cost supplies that are stored in the warehouse?

Never use a JE for inventory in QB.

 

What you asked here: "They're not really inventory items insofar as they are never sold, but we do buy in bulk, hold them, and then distribute as they are needed."

 

Is "Adjust Inventory" and in that screen, top, you assign which Job it gets assigned to, for Relieving it from Stock on hand, but not actually Selling It. That way, you assigned that Cost to the Job and removed it from On Hand.

 

In the job reporting, you will need to remove the Account filter, because you do not want only ordinary income/expense; you want Job reporting to also include COGS.

 

You can see this in my attachment.

Community Explorer **

Re: How to job cost supplies that are stored in the warehouse?

Thank you! That was exactly what I was looking for!