The QuickBooks accounting software is a powerful tool that is used by many small and medium businesses across the globe to manage their accounting tasks. It is used by businesses to generate client bills, create customer invoices, write payment checks, manage payroll, and schedule the timing of sending recurring payment invoices to those customers who are your regular clients.
In addition to these accounting related tasks, the QuickBooks accounting software can also be used for managing and tracking the inventory. The tracking and managing of inventory in your business is a very complicated and time consuming task. It is very important for your business also as it ensures that you have enough products in your warehouse or store to meet the demand of your business.
The management of inventory is related to all other functional areas of your small or medium business.
Inventory tracking option in QuickBooks
All the versions of QuickBooks accounting software released so far by Intuit have the option of Inventory tracking. At the time of installation, this option of Inventory tracking is disabled. You have to enable it once you have installed the QuickBooks software.
Once the Inventory tracking option is enabled in QuickBooks, you can not only keep a track of the inventory but also you would get notification alerts when any particular product is going to end in the stock. In this way, you can save time by procuring the required product at the last moment when the requirement arises.
It is recommended to use the option of Inventory tracking in QuickBooks Online as this will allow multiple authorized users to access the inventory data from anywhere. Let us go ahead and see how you can setup the Inventory tracking option in QuickBooks for the first time.
Setting up the inventory tracking option in QuickBooks Online
First of all, you have to select the Company Settings option by clicking on the Gear icon from the upper right corner of the QuickBooks home page. When the Company Settings page opens from the left pane, click to select the Sales option. Once selected, you have to ensure that all the below given three inventory settings are turned on.
The three inventory settings that need to be turned on are:
1. Show Products/Service column on sales forms
Turning this option ON will enable adding a product or service column on the sales forms. With this you can easily select any item from the list of products and services to include.
2. Track quantity and price/rate
This will enable adding quantity and rate fields to sales forms so that you can easily track this info data for products and services. You have to ensure that this feature is always turned on.
3. Track quantity on hand
This third setting allows you to track available inventory for each of the product that you sell and the related costs of the inventory. This feature also needs to be turned on.
Once you have turned on all the three inventory settings, you have to click on the Save button to save the changes made. Now if you wish to search products and services in QuickBooks Online, you just need to click on the Gear icon located at the top right corner, and then click on the Products and Services option. On doing this, the product and services window will be displayed.
Adding A New inventory item to QuickBooks Online
When the product and services window is open, click on the New button from the top right corner. Under the Select a Product Type option, click on Item, and you will be presented with the Product or Service Information window. In this window, you will see 14 entry fields.
Let us talk about these 14 entry fields in detail.
- Name of item: In this field you need to enter the name of the item. The name of the item should be unique. You can use a mix of alphabets and characters to give a name to the item.
- SKU: If you are using SKUs to manage your inventory, enter the SKU number here or leave it blank.
- Picture of the product: Here you can upload a picture of your products in your inventory list.
- Track Quantity on Hand – Check to select the box to indicate that you track inventory for this item.
- Initial Quantity on Hand: Here you have to enter the number of inventories you have in stock. Make sure that the quantity that you are entering here is correct as wrong entry may have a bad impact later on.
- As of Date: Enter the date corresponding to the quantity of inventory you entered in the above discussed field. This field too is very important as it has a direct impact on your tax related calculations.
- Inventory Asset Account: Mention your Inventory Asset account number here.
- Description on Sales Forms: Give a brief description of the item here. This description will show up with the product.
- Description on Purchase Forms: Here also give a brief the description of the item. This information will be displayed on the purchase orders and vendor receipts.
- Price/Rate: Mention the sales price of each unit here.
- Cost: Here you have to mention the cost price of each product.
- Income account: You have to be very careful while filling this field. You can check the income type from the right side of the account name.
- Expense account: This field too is very important and is to filled with utmost care. Make sure you choose the account type as ‘Cost of Goods Sold’.
- Is taxable: If you charge sales tax from your customers, click to select this field or else leave it blank.
Once you have filled all the 14 entries correctly, click on the Save and Close button. You can edit or delete any inventory item from the products and services list any time.
Need Professional Help?
Hopefully, you must have understood the benefits of Inventory tracking and management option in QuickBooks, and how you can setup the inventory in QuickBooks for the first time. If you still have any doubt or query, you can reach out to our QuickBooks Support Team. Our QuickBooks technical experts can respond to all your queries and clear all your doubts related to the inventory tracking option in QuickBooks Online. Our QuickBooks technical experts can even assist you in setting up inventory in QuickBooks Online for the first time. You need to be very careful while setting up the inventory, so it is recommended to take an expert’s help while doing so. Our QuickBooks Support Team can also help in importing the inventory data in Excel, or resolving any technical issue that you might come across while using the QuickBooks accounting software to manage the finances of your small or medium business. For expert help, fell free to call us 📞.
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