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marigom
Level 1

Recording Bills from Vendors

I am trying to record the bills for some inventory that we have ordered. I have a question in regards to the best way to record each item that comes in when it comes to the sales tax. Should I record the sales tax on its own line or should I include the tax in the price of each item that we have received. I just want to make sure that I am recording each invoice properly.

1 Comment 1
BigRedConsulting
Community Champion

Recording Bills from Vendors

Normally you don't owe sales tax on inventory you purchase for resale.

 

QB doesn't track sales tax on purchases.  If you need to track it, perhaps in order to get refunded for it when you file your sales tax forms, then you can add it as it's own line item on the bill.  Probably, there's no reason to enter multiple line items for the tax.

 

If you don't intend to get a refund for the tax paid, then the tax is an expense to you, part of COGS.  In this case include it in the item's price paid.

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