Greetings Big Apple, I'm glad you could join us today! Allow me to provide some information about inventory in QuickBooks Online Essentials.
With QuickBooks Online Plus, you can track inventory costs and quantities since inventory feature isn't currently offered in QuickBooks Online Essentials. If you'd like to track inventories, you'll need to upgrade to the Plus version of QuickBooks Online.
if you keep periodic inventory in essentials, you do it in one of two ways. choose one and stick with it, you can not mix and match
1. (my preference) Create an asset account called purchases and post all purchases of item for resale to that account. Periodically, weekly, monthly, etc value the inventory on hand, subtract that value from the amount shown in the purchases account and do a journal entry for the answer to the subtraction debit COGS for that value credit purchases for that value
2. Post all purchases to COGS. Periodically, but at least at the end of the year, you value the inventory on hand and do a journal entry. debit the asset purchases account for that value credit COGS for that value
Print the P&L then reverse the journal entry debit COGS for that same value credit the asset purchases account for that value
This last journal entry, moves the value of what was on hand at the end of year back to COGS so the cost will be counted against the new year sales.