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I have been troubled with the issue of COST . I have called support several times and there seems no one answering the phone with a straight answer. They all look just as confused as I am!!
Looking at QuickBooks Enterprise Advance Inventory. I need help in definition of COST, SALES PRICE , LANDED COST and AVERAGE COST.
Please, can anyone confirm if AVERAGE COST is the same as LANDED COST? It looks to me that these terms are use interchangeably. ALL QBD reports only deliver report of AVERAGE COST. I find no report pointing to LANDED COST.
From inspection of the purchased Inventory Item dashboards, the COST field is populated with the price from the vendor Invoice at Receiving. At the same time, QuickBooks allows to determine LANDED COST from relationship of expenses associated with inventory purchases such as container shipment, taxes, etc... This number shows after adding landed cost..
The main Inventory windows reads AVERAGE COST and this is where things get al confusing.
From the detail Inventory Item information windows looks like this:
The main Inventory windows reads AVERAGE COST and this is where things get al confusing.
This is confusing as I am not sure if item COST field needs to be replaced with the LANDED COST. This will be relevant in order to get a correct picture of MARGIN and MARK UP pricing.
And at the same time, not sure what the average cost refers here. I always considered Average cost as the average of an item in the inventory received at from possible different vendors, dates and at a different purchase prices. But I am not sure if the COST field is mean to be replace with the calculated LANDED COST.
Allow me to join you here and answer your inventory-related questions, jecalderon.
Cost is the actual amount of the item when your purchased it, while Landed cost is the sum of expenses associated with shipping a product. Typically, the term refers to the costs connected with international shipping like taxes and fees.
Average cost on the other hand is the sum of the cost of all of the items in inventory divided by the number of items. To put it simply, cost is the actual amount of the item, landed cost is the amount of the item, plus the shipping and handling expenses, and average cost is the average amount you spent for of all items you have on hand.
This also means that the AVERAGE COST is not the same as LANDED COST. This is because QuickBooks will only factor the amount in the Cost field when calculating the average cost.
Additional details about this are discussed in the following articles:
- Landed Cost FAQs
- How to Set Up Landed Cost in QuickBooks Enterprise Services
- How to Calculate Landed Cost in QuickBooks Enterprise Services
- Everything You Wanted to Know About Landed Costs in QuickBooks Enterprise
At the moment, there's no specific report about landed cost in QuickBooks Desktop. However, you can open your Chart of Accounts and run Quick Report for the Landed Cost account. Here's how:
- Go to your Chart of Accounts and look for the landed cost account.
- Right-click on it and select Quick Report.
Let me also share these articles for additional references:
- Balance Sheet and Inventory/Stock Valuation Reports Show Different Amounts for Inventory Asset Accou...
- Understand Inventory Assets and Cost of Goods Sold Tracking
Please let me know if you have other questions about inventory-related costs. We're always here to make sure they're all taken care of.
Hi there, @aht1. I'll share the details with you explaining the average landed cost in QuickBooks Desktop (QBDT).
Inventory costing can be tracked using the average cost method. This method calculates the average cost by dividing the total cost of all purchases by the number of items in stock.
When a sale is made, the average cost is used to determine the cost of the item sold. The cost does not change until a new purchase is made at a different cost. The average cost method takes into account the last purchase as well as the previous purchases until all quantities are accounted for.
To elaborate on the columns highlighted in yellow, the Unit Cost is the total expenses incurred by a company to produce, store, and sell a particular product or service. This section is manually entered during the item setup, as seen in the screenshot below. Moreover, the Amount is the product of the Quantity on Hand and the Unit Cost.
To better explain the following amounts reflected on the report, I'd recommend contacting our Technical Support Team. This is to allow our support to initiate a screen-sharing session that would allow customers to convey the details through sharing screens while maintaining their privacy. Also, it is to determine where the following amounts are coming from, as filtering the dates would matter. Get in touch with them by following the steps below:
- Go to this website: https://quickbooks.intuit.com/learn-support/en-us/contact
- Select QuickBooks Desktop for the product section.
- Choose an Edition from the dropdown.
- Type in your concerns in the designated section, and click Continue to proceed.
- From the options, select either Chat with us to start a conversation or Receive a Callback to get a spot in line and call you back.
Additionally, refer to this article for other options when contacting them. You can also scroll down to the bottom to take note of their support schedule and hours: Contact QuickBooks Desktop support.
Moreover, I’ll add this article to learn more about the principles of reporting data. You can also check on how you can customize them more effectively: Understand reports.
If you have any further inquiries about managing reports, feel free to visit the Community. I wish your business the best of luck in prospering. Please take care and stay safe.
