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billhdz
January 3, 2023
Solved

Inventory Adjustment Question

  • January 3, 2023
  • 1 reply
  • 14 views

Happy New Year!!!

 

Last year in July I ordered 50 posters to sell.  The order was printed wrong with defects.  I was not charged for them.  Instead, the company just sent me a new batch of 50 posters corrected and printed well.

 

Before I got the good replacement posters order in, I had a client that needed to get some posters for an event he was doing, and did not mind that they were defective,  so I sold him some to get him out of a bind.  I didn't want to do this, but I also wanted to help him since he couldn't wait until the good order came in.

 

I never entered the bad posters into inventory because I am going to trash them and I did not get charged for them.  They just sent me new ones later.

 

Now I have an inventory issue, because it shows that I sold more than the amount entered into inventory.  I am off by 9 posters that client purchased when he purchased the bad posters from me.

 

Questions:

1. Do I enter the bad posters into inventory to fix this as a zero charge order?  

and if YES, how do I make the rest ( 41 quantity )  bad one as damaged inventory to take them out of inventory ( except for the 9 bad ones that the client purchased ).

 

2. OR, do I just make an inventory adjustment to add the posters needed to fix my inventory count and not enter the bad batch of posters?

 

Thank you for your time!

Bill

Best answer by Rainflurry

@Rainflurry , thank you!

 

When you say "If you want to put those 25 posters into inventory, you can enter a bill for 25 more at $0.00.", 

This bill I am entering,  is that another sales bill from the vendor of the posters?  ( Like the way I am entering the  vendor bill for the 9 posters @ $0.00/ea and dating it prior to 12-9 so that I can complete the invoice of 15 posters to and receive the payment. )?  

 I just enter another different bill that same way?  Is that correct?

 

Thanks again!

 


@billhdz 

 

You got it.  Just enter another bill for 25 items of that particular poster at $0.00 each and QB will put 25 more into inventory and the bill (since it was entered at $0.00) will show as paid.  I would date the bill as of the day you decided to put them into inventory.

1 reply

Rainflurry
Rainflurry
Level 11
January 3, 2023

@billhdz 

 

Presumably, your QB inventory shows 9 fewer posters than you have on-hand, correct?  If that's the case, I think the best solution is to create a bill from your vendor for 9 posters at $0.00/each.  That will put 9 posters into inventory and will recalculate your average cost to include the 9 posters you received free of charge.  

 

 

B
billhdzAuthor
January 4, 2023

@Rainflurry 

Thanks for the reply.

 

1. If I do it this way, will any of the invoices I already created from poster sales get messed up?

How does Quickbooks handle those entered from the created bill from my vendor for posters at $0.00/each?

 

2. When Quickbooks recalculates the average cost to include the 9 posters when they are entered at $0.00/each, what does that do to the invoices or sales numbers?

 

3. Will doing an inventory adjustment instead something to consider?

 

Thanks!

 

 

 

Rainflurry
Rainflurry
Level 11
January 10, 2023

@Rainflurry 

 

I definitely don't want to be Changing dates to influence your COGS calculation.  I always like to do things by the book.  I don't want any problems in the future. This is why I am seeking help with this to do it properly in Quickbooks and to understand it in case it happens again in the future.  Our business is just me and my wife, and we don't want any issues to deal with.  We just want to take care of our customers the best way possible and show our artwork via posters, etc for everyone to enjoy.  I think it's great that you like to help people with your talent.  I like to think of myself as doing the same thing in a different way as an artist. I admire you for that.

 

When the order of bad posters came in the order number #09748826 was issued on 7/5/22

When the good replacement posters came in, the NEW order number #09788695 was issued on 7/14/22. 

 

I did enter the vendor bill for the good replacement posters as 7/5/22 thinking that I was just going to trash the entire bad order.  

Maybe I need to change the date on that vendor bill from 7/5/22 to 7/14/22 and just create the new one to allocate for the extra posters ( bad order )  as 7/5/22 since this is the order with the bad posters.

 

Will this work?  Am I understanding correctly?

 

Thanks again!  🙂

 


@billhdz 

 

Maybe I need to change the date on that vendor bill from 7/5/22 to 7/14/22 and just create the new one to allocate for the extra posters ( bad order ) as 7/5/22 since this is the order with the bad posters.

 

Agreed.  Since that is what really happened (bad posters received 7-5, good posters received 7-14), that is the right way to do it.  

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