QBO Beginning Inventory vs. Inventory Asset

Hello there, LPD1.

We can't delete a journal entry that is created for that inventory account. You can make another journal entry to offset these inventory amounts. However, you'll need to consult an accountant to get more help with identifying which account to select.

You can always get back to the Community if you have other questions.

---

@LPD1 wrote:

I am using QBO.  Accountant previously set up inventory amount as a "beginning inventory" figure under current assets because I was not tracking inventory in QBO at that time. They then made a journal entry at the end of each year to account for increase or shrinkage, which gave me an accurate inventory number on my balance sheet.

 

Beginning 2018, inventory is properly recorded in QBO and shows under Inventory Asset. Now "total other current assets" is reflecting beginning inventory plus inventory asset.  How do I correct this so my assets are propery reflected?  I basically need to only count my inventory asset number to be correct on my reports and taxes.  Hope I wasn't too unclear.

---

IF, if when you changed to inventory items, you started with new items and new purchases of those items, fixing this is fairly easy.  In other words items already on hand were not included

BUT, if when you started with inventory items and you used a starting count/cost for items you already had in stock - that changes things.

So which was was it?

If the inventory was sold through sales to your customers during the time you were not keeping track of inventory in Quickbooks, that would mean that your invoices to your customers were more generalized in the product/service and not actually reducing any inventory (since it wasn't in there) nor crediting cost of goods sold GL account, only adding to your sales account.  Your accountant was probably making an adjusting entry (like mine did) when you added in the manual inventory numbers at the end of year, via excel spreadsheet, to your beginning asset account and also they would have offset it to your cost of goods sold account through a JE.  In our case, our beginning asset numbers really have been sold to customers but not indicated through our customer invoices since we were not tracking inventory so cost of goods sold was not being adjusted when sales occured as it should have been.  So I would do an Journal Entry to move the beginning asset balance and offset it to cost of goods sold and well document it in your description.  Double check this with your accountant though.  I am not an accountant.  Just 10 years experience with QB.