QuickBooks Pro 2022 Beginner: Adding Inventory

Name: QuickBooks Pro 2022 Beginner: Adding Inventory
Author: Takeisha Strong

Learn how to add inventory to a company’s QuickBooks file

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Course: On-Demand

In this lesson, you will learn how to add inventory items to your QuickBooks file. Let's continue using our sample product based company Rock Castle Construction to complete the lesson. The first thing you'll want to do is make sure inventory is enabled in your file. Select edit. Then preferences from the main menu. Select items and inventory. Then the company preferences tab. Check the box for inventory and purchase orders are active press okay. QuickBooks will warn you that it must close and open all of your windows to change the preference, press okay. Now the inventory is enabled, let's take a look at our items list. There are three item types related to inventory, inventory part, non-inventory part and the optional use of a group. Let's start by creating another sub item for our new privacy fence option. Once we create new item, we have the dropdown list of all the item types available. Let's select inventory part. QuickBooks reminds you that inventory part is used for goods that you purchase, but you also need to track. For our item name, let's call this fence panel. We'd like to create this as a sub item of our privacy fence. Remember, when creating sub items, the parents and the sub item must have the same type. We don't have a part number so let's move on to the description. We'll call this a wooden fence panel. We can use the same description on our sales transaction, which is the invoice. Next, we can enter the cost that we pay the vendor for each of the panels. Let's select $10. Once we sell the product, the cost of the fence sold or the cost of goods sold will post to our profit and loss statement. In this case, $10 will post as the cost of the fence panel. We'll select cost of goods sold for our account. If you have a preferred vendor, you can press the dropdown menu to select it. Next, let's enter our sales price. We charge our customers $50 per panel. The next dropdown you can select if the item is taxable or not and where you would like the income to post once you charge your customer. Let's select construction income. This bottom portion tracks the inventory related to the item. We first want to select which account will post the inventory to. In this case, we have one inventory account called inventory asset so when we purchase the fence panel from our vendor that $10 will post to this inventory asset. Once it's sold, it will reduce the inventory asset and move over to the cost defense or goods sold. Because this is a new item for us, all of these values can remain zero. We don't have any fence panels on hand so the quantity is zero along with the related value. These will increase as you purchase more inventory. Also QuickBooks can remind you when it's time to reorder more. Just enter your minimum reorder point here. One more thing to show is the custom fields. If you'd like to list the color or material of the panel, you could do so here and define additional fields using this button. Let's select okay to save this part. Next, we allow our customers to add custom decor to their privacy fence. We purchase this item from our vendor and we sell it to the customer at a markup. This would be considered a non-inventory part. Let's create it. On the dropdown menu, we'll create non-inventory part. QuickBooks reminds you that this is used for goods that you buy, but do not track. Let's name the item Custom Decor. Because it is a non-inventory part, we cannot include it as a sub item of the privacy fence which is a inventory part. They may differ from time to time so we don't wanna include a specific part number. Unfortunately, assemblies are only available at a higher QuickBooks subscription level even though it's shown here in the accountant's view. Let's add a description for our custom decor. We'll call this custom decor for privacy fences. This section is going to list how much we charge our customer for the product. Because it may vary. We can leave the price at zero and update it once we add it to the invoice. We can use the dropdown to and also note where we would like to post that income once it's sold. Let's choose design income. Select okay to add the item. We can also use groups as an inventory item. A group is not an item in itself, but rather a shortcut to add multiple items to a form at once. Let's create a custom privacy fence package. We'll create a new item and select group from the dropdown. QuickBooks reminds you that this is to quickly enter a group of individual items on an invoice. We'll name this our custom privacy fence package. We'll leave our description blank since our group name is self-explanatory. Printing the items in the group allows each individual part to be listed on the invoice. Let's select our items. We'll begin with our privacy fence items which is our fence panel, our fence handle and we'll also add our new custom decor package. You'll see that the description we enter for each item will flow over. Now remember, inventory parts are the only parts within QuickBooks that we can track the quantity for. Our inventory parts are the wooden fence panel and the privacy fence handle. Because the number of panels may vary from time to time depending on what the customer needs, we'll leave this blank and we can enter it on the invoice directly. Typically, we only need one handle per fence project. Let's enter the number one here. As we add this group to our forms, once the invoice is closed out, all of the inventory parts that have a quantity listed will update accordingly. Let's select okay to save this group. You'll see we have a new group now called the Custom Privacy Fence package. Stay tuned for the next lesson where you'll learn the accounting workflow for our inventory transactions. Thanks for watching.

Beginner Provider : Takeisha Strong 3 Lessons · 17m in Arabic, German, English, Spanish, French, Portuguese, Chinese

Course Description

Some companies purchase products wholesale to sell or bundle goods to their customer base at a retail rate. Other companies may use several raw materials to build a new product for their customer base. In both instances, the ability to track the products during each step of a transaction is critical. The accounting software can inform management how much needs to be ordered, when, and how much to hold in storage. Developing the proper inventory reports also equips management to assess the profit margins based on inventory costs, compared to the finished item sold.

All products and services are categorized as items within QuickBooks Pro 2022. The Pro subscription level of the software allows users to add, track, and adjust the quantity of inventory on hand in a company’s file. In Adding Inventory, users will be able to define the different types of items in QuickBooks, including inventory. Users will learn how to add inventory items and understand the accounting workflow for inventory transactions.

What You'll Learn

Identify and categorize the different types of items in QuickBooks Pro 2022, including inventory items
Define the various types of inventory used within QuickBooks
Add inventory items to a company's file in QuickBooks Pro 2022
Understand the accounting workflow for inventory transactions
Explain basic inventory terminology
Track and adjust the quantity of inventory on hand using the Pro subscription level

Key Takeaways

In QuickBooks Pro 2022, all products and services are categorized as items, including inventory.
The Pro subscription level allows users to add, track, and adjust the quantity of inventory on hand in a company's file.
Tracking products during each step of a transaction lets the software inform management how much to order, when to order, and how much to hold in storage.
Developing proper inventory reports equips management to assess profit margins based on inventory costs compared to the finished item sold.
The course covers defining item types, adding inventory items, and the accounting workflow for inventory transactions.

Frequently Asked Questions

Who is this course for?

It is a beginner-level course for QuickBooks Pro 2022 users who need to add, track, and adjust inventory, including companies that purchase products wholesale to sell, bundle goods, or use raw materials to build new products.

What will this course cover?

It covers defining the different types of items in QuickBooks including inventory, adding inventory items, and understanding the accounting workflow for inventory transactions, across three lessons: Types of Inventory: Defined, Adding Inventory Items, and Inventory Workflow.

What skills will I gain from this course?

You will build skills in inventory accounting, inventory management, inventory management systems, inventory planning, and QuickBooks accounting software.

Which version of QuickBooks does this course use?

This course uses QuickBooks Pro 2022, and the Pro subscription level allows users to add, track, and adjust the quantity of inventory on hand in a company's file.

Why is tracking inventory important according to this course?

Tracking products during each step of a transaction lets the accounting software inform management how much needs to be ordered, when, and how much to hold in storage, and helps assess profit margins based on inventory costs compared to the finished item sold.