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jmadden
February 12, 2022
Question

Inventory Asset Account A/R does not match actual customer invoice and payment.

  • February 12, 2022
  • 1 reply
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We are having a problem with inventory assets and how Quickbooks is applying customer invoice payments, which is creating an inflated balance in our Inventory Asset account. As an example, a customer invoice may be for $20,000, and the $20,000 payment is received and applied to the invoice. But the invoice is showing up as $12,000 on the Inventory Asset account, falsely increasing our Inventory Asset account by $8,000. Does anyone know why the entire invoice amount isn't being applied to inventory assets, and how to correct this? 

1 reply

R
Rea_M
February 12, 2022

I'm here to help you sort this out, @jmadden. This way, you're able to correct the Inventory Asset account's amount and apply the entire invoice payment to it in QuickBooks Desktop (QBDT).

 

The items in your invoice may be using different inventory accounts or some of them aren't assigned to Inventory Asset. This is why the entire invoice amount isn't applied to the appropriate one accordingly.

 

With this, I'd recommend reviewing the items that are on the entire invoice. You'll have to make sure they are using the Inventory Asset as their inventory account. To do this, here's how:

 

  1. Go to the Lists menu.
  2. Select Item List.
  3. Find the inventory item. Then, right-click and select Edit Item.
  4. In the Edit Item window, go to the Asset Account section and update as necessary.
  5. Click OK. 

 

Also, QuickBooks uses the weighted average cost to determine the value of your inventory and the amount debited to COGS when you sell them. To learn more about how you can handle the inventory asset accounts in QBDT, I'd recommend checking out this article: Understand stock assets and cost of goods sold tracking.

 

Let me know in the comments if you have other concerns about managing your invoices, payments, and inventory accounts in QBDT. I'm always ready to help. Take care, and I wish you continued success, @jmadden.

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