Showing results for 
Search instead for 
Did you mean: 
Level 1

Items received at no cost ( samples ) and sold after.

Manufacturer provides items for free - kits for cleaning.  Items captured  in inventory at a Avg cost of zero since we paid $0.  However sometimes we do purchase such kits if we run out of samples. 

Kits sometimes are given to customers, sometimes we charge for the kits.

If  Kits are  zero cost and some at cost, the AVG cost is incorrect  ($ paid / qty on hand), as a result when item is sold the entry capturing the cost will be incorrect. 

Two questions:

1. Is it a good idea to capture items in inventory (since we want to keep track of the items) if we do not pay for the kits? Looking at the valuation report qty on hand and no value it does not look ok. It is confusing. 


2. How should transactions be handled? 


Thank you

Level 15

Items received at no cost ( samples ) and sold after.

when you add qty that has no cost, then QB redoes the math, total value / total qty - that happens with each purchase.

the option is to create a different inventory item, widget-free, and stock that with qty and no cost.  Then you give that away, sell it, or sell the regular widget you order with cost.

Technically there is no such thing as free, if a vendor gives you some widgets, those have value and that value is income. 

Level 15

Items received at no cost ( samples ) and sold after.

In other words, your average cost, including the zero cost items, is Factual. You got some free and some, not free. That's why it is called Average.

Sign in for the best experience
Ask questions, get answers, and join our large community of QuickBooks users.
Sign In / Sign Up

Need to get in touch?

Contact us