I am trying to setup work in process inventory

You may need a manufacturing app and integrate it with your QBO to do so.

It looks like you're referring to WIP, Paultr.

In addition to what Fiat Lux - ASIA shared, WIP is accumulating costs in an asset account. Once a project is complete and sold, the costs in the asset account are moved to the Profit and Loss report, an expense account.

We're unable to set it up automatically, though. You'll have to manually create a WIP account. Then, use it when creating transactions. Here's how:

1. Click Accounting.
2. Go to the Chart of Accounts tab.
3. Click New.
4. Select the Account Type and Detail Type.
5. Enter a desired name, then click Save and Close.

I'd suggest reaching out to your accountant on the best way to categorize the account. They can also help you with the WIP workflow.

Let me include the article on how to set up and track your inventory as a future reference.

If there's anything else that we can do for you, please don't hesitate to reach out to us again.

We currently have the Premier Manufacturing and Wholesale Edition 2021.  Do we need to follow same steps as suggested for a manual WIP account?

Thanks for joining in, @TVo. The steps shared above is for QuickBooks Online version.

I've got you the steps for the Desktop version. 

Step 1: Create an account

1. Go to the Lists menu, then select Chart of Accounts.
2. Click the Account button, then select New.
3. Select Other Current Asset for the account type.
4. Click Continue.
5. Enter Work in Progress for the Account Name.

I'd also suggest consulting your accountant to help you choose the right account.

Additionally. I've got you an article about tracking the products you manufacture to help you record the stocks you build using inventory parts. 

Feel free to drop a comment below if you have other questions. I'm always here to help you some more.

Great! But when the product is finished, How do you convert the WIP to regular inventory  ?

How do you convert the WIP items to regular inventory when they're finished in production ?

Good afternoon, @cbrown119. 

Thanks for joining in on this thread. I can give you some information to help answer your question. 

Once the project is completed, prepare an invoice or sales receipt with a line for the sales price (mapped to an income account) and then add the two other charge items you created above making sure to use a negative amount for Transfer into COS. Once done, the ending total for the invoice should match the sales price. Here's a guide that can help you out with WIP in the future: What is work in process (WIP) inventory? Definition, formula and benefits. 

In the end, we recommend consulting with your accountant to be sure this is the best route for your business. They'll be able to give you the best accounting advice for this situation. If you don't have one, check out this link to find one near you. 

This should do the trick and get the WIP items to regular inventory. If you have any other questions about inventory, don't hesitate to ask. I'm only a few clicks away. Have a fantastic day!