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JulianaWolf
October 14, 2021
Question

How to set up Consignment as the Consignee

  • October 14, 2021
  • 2 replies
  • 21 views

Hi, I have my first Consignment and I am the consignee. Do I set the consignor up as a Vendor? We sell xxx amount of products for their inventory and then we send them a report of our sales monthly, minus our fees, etc... then payment will be sent.

 

I am worried I would like to set up this model in qbo plus.

2 replies

L
LollyNino_CQuickBooks Team
QuickBooks Team
October 14, 2021

Hello there, @JulianaWolf. 

 

Thanks for dropping by the Community, I'm happy to help, what you're going to want to do is set them up and record them as vendors and classes, follow along below for the steps. 

 

If you sell items on consignment, you can track and generate a report that shows consignment sales you have made and how much you have paid out to consignors.

 

There are four basic steps to this procedure:

  1. Set up consignors as vendors and classes.
  2. Set up consignment income accounts and items.
  3. Record consignment sales and payouts.
  4. Create consignment reports.

You can set up your consignees as customers and assign classes to them in the program. Then, set up yourself as a vendor since you're the consignor. Let's turn on the class tracking feature before performing the steps below. 

 

To enter consignees as customers: 

  1. Go to Sales from the left menu. 
  2. Select Customers.
  3. Choose New customer.
  4. In the Customer Information dialog, enter the consignee's details.
  5. Click Save. 
  6. Repeat the process for other consignees. 

To set up consignees by classes: 

  1. Go to the Gear (Settings) icon at the upper right. 
  2. Select All Lists under Lists. 
  3. Choose Classes.
  4. Click New.
  5. In the Class dialog, enter the consignee's Name.
  6. Hit Save. 
  7. Repeat the process for other consignees. 

Once done, go to Suppliers from the left pane and select New supplier. Then, enter your details in the Supplier Information window. This way, you can set up yourself as a supplier. 

 

You can enter invoices or sales receipts to record the consignment sales and the outgoing inventory. Please make sure to use the Consignment item and select the appropriate consignee in the Class field.

 

For additional details about tracking consignment sales, check out this article: How to record consignment sales

 

I'm always here if you need further assistance setting up consignment in QBO. Feel free to post a comment below to notify me of your response. Take care always.

P
Peter Marc
December 5, 2021

I don't have classes when I click the drop down. But anyways that's besides the point.  I'm as cosingee and sell things that are owned by our business partner through an online store.   The online store triggers the sale and is integrated with QBO and I am tracking the inventory items so the inventory balance is always negative on these items (i.e. zero starting balance and goes down every time a sale is made).  Here is how it's booked if I make a sale for a $10 item that was purchased on consignment (at the same time) for $5. 

 

DR: CASH                                       10 

   CR:    Consignment Sales                10

DR:    Consignment COGS              5

   CR:   Consignment inventory             5

 

Now I understand that the correct accounting treatment is to have Accounts Payable: Cosigner payables instead of a negative inventory on the balance sheet. But QBO doesn't allow that, so I transfer this to my AP periodically. 

 

My problem is when I receive the bill from the vendor (cosigner) and it has the amounts that I owe them for the inventory.  If I follow the logical accounting treatment I have double booked COGS and AP.  

 

DR:  COGS                         5 

   CR:    AP cosigner                5

 

Can someone help me out. 

JessT
JessTModerator
Moderator
December 5, 2021

Hi there, Peter Marc,

 

Thank you for joining in on the thread.

 

In regards to the direct posting of transactions to accounts, I would recommend consulting an accountant about it. They are the best resource to make sure you choose the right accounts for your transactions.

 

If your accountant has instructions that you find challenging to do in QuickBooks, feel free to go back to this thread. We'll assist you with it.

 

Thank you and take care always.

Fiat Lux - ASIA
Fiat Lux - ASIA
Level 14
October 15, 2021

@JulianaWolf 

Another option, consider having a consignment app to integrate with your QBO.

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