I am trying to set up my inventory items, and an income account is required. I read a post about this and it said to use our sales income account, but I don't understand why I would need an income account for inventory. Why would we account for sales via inventory? We invoice a sale, it hits A/R and our sales acct - the invoice then reduces inventory and increases COGS. Why do we put an income account in the inventory item?
I get that the sale will hit my sales account, but I am unsure of why this account is used in inventory. Is it because of integration? So, the accounting is done through the inventory screen as opposed to the invoice screen?