Vendor credits toward inventory purchases

SIGMA03 · ‎January 29, 2020

How do I enter a cost reduction towards an inventory purchase without reducing the quantity of the inventory? For example: I entered a bill for 1 widget for 10,000, then I pay $5,000 for the widget. Upon delivery it is discovered that the widget isn't as valuable as we thought, so we negotiate with the seller to reduce the cost to $7,000. If I enter a credit for $3,000 it reduces the amount I owe for the final payment, but it also reduces the inventory count for that widget to 0.

SIGMA03 · ‎February 28, 2020

Here is how you fix it without screwing up any inventory counts or gen ledger accounts:

Enter a credit for the vendor using the same PO number as reference. Do not make the adjustment to the items on the PO. On the expense tab, enter the amount of the credit into the Inventory Adjustments account. Save the credit and apply it to the PO to adjust the balance due.
Make an inventory adjustment to adjust the TOTAL VALUE ONLY and use the Inventory Adjustments account as the adjustment account. When you enter the new value of the equipment the total amount adjusted should equal the amount of the bill credit you already entered.

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Catherine_B · ‎January 29, 2020

Hello there, SIGMA03.

We can adjust widget's item cost and delete and recreate the bill and its payment. This way it'll set the cost to the negotiated amount and won't zero out the quantity.

Let me show you how:

Go to the Lists menu and click Item List.
Look and double-click on the item to open the details.
Modify the Cost.
Click OK.

Let's go to the vendor's list of transactions to open the Bill Payment and click Delete from the menu. Do the same thing for the Bill. You can also check out this article for more details in adjusting your item's quantity or value.

I'll be here if you need more help. Thanks!

SIGMA03 · ‎January 29, 2020

The problem with modifying the bill is if the adjustment comes in a different period. At that point I can't just edit the bill.

Rose-A · ‎January 29, 2020

Good day, SIGMA03.

If you're trying to modify a reconciled bill from the previous year and the book has been closed, you'll need to enter the closing date password to allow the modification of the transaction.

However, this may change the sum of all your reconciled transactions, known as the reconcile opening balance. To prevent issues with your balances, it's best to consult your accounting professional.

To know more about setting closing date and password in QuickBooks, see the following articles below:

Please don't hesitate to reach out to me again if there's anything else I can help you with. Thanks for reaching out, wishing you and your business all the best!

SIGMA03 · ‎February 28, 2020

Here is how you fix it without screwing up any inventory counts or gen ledger accounts:

Enter a credit for the vendor using the same PO number as reference. Do not make the adjustment to the items on the PO. On the expense tab, enter the amount of the credit into the Inventory Adjustments account. Save the credit and apply it to the PO to adjust the balance due.
Make an inventory adjustment to adjust the TOTAL VALUE ONLY and use the Inventory Adjustments account as the adjustment account. When you enter the new value of the equipment the total amount adjusted should equal the amount of the bill credit you already entered.

View solution in original post

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Vendor credits toward inventory purchases