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Top Sake
August 3, 2020
Question

When cost of goods sold is comprised of a few bills in different currencies

  • August 3, 2020
  • 1 reply
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I need helps on cost of goods sold.  My company imports products (a number of SKU) from manufacturer in Japan on FOB terms and engages a logistics company in Hong Kong for international shipment.  My company pays Japanese Yen to the manufacturer and Hong Kong Dollars to the logistics company.

 

So the cost of goods sold is comprised of 2 bills which are settled in different currencies.  Please advise how to record this in QuickBooks?  Thank you!

1 reply

MarsStephanieL
MarsStephanieL
August 3, 2020

I'd be glad to help you input your bill in QuickBooks, @Top Sake.

 

You can turn on the Multicurrency feature first, then create two vendors. One with the Hong Kong Dollar and another onw with the Japanese Yen. Then, create a wash account with both currencies. These accounts are created to properly manage the conversion when matching with the bank feeds.

 

Here's how:

 

Step 1: Turn on Multicurrency feature.

 

  1. Go to Settings and select Account and settings.
  2. Select the Advanced tab and go to the Currency field.
  3. Click the Edit or Pencil icon, then select your home currency.
  4. Click on the radio button to turn on the Multicurrency feature. Note: Once you've turned on the feature, you'll no longer have the option to turn it off.
  5. Select Save and Done.

I've added a screenshot for your reference:

 

 

Step 2: Create two vendors with the Hong Kong Dollar and Japanese Yen.

 

  1. Go to the Expenses menu and select Vendors.
  2. Click the New vendor button.
  3. Enter the necessary fields and make sure to select the specific currency of the vendor in the I pay this vendor field.
  4. Select Save.

 

Step 3: Create two separate bills for both currencies.

 

  1. In the Bill transaction page, enter the name of the manufacturer.
  2. Fill in the details and select Save and close. 
  3. For the logistics, create another bill transaction and enter a service type item for transportation.
  4. Input the important details, then select Save and close.

Here's how it looks like:

 

 

 

To create the wash account, I'd recommend checking out to this article for the detailed steps: Add an account to your chart of accounts in QuickBooks Online.

 

For more information about the Multicurrency feature, you can review this article: Turn on and use multicurrency.

 

To record the payments and match it with the bank transactions in the future, please check out these articles:

 

 

I'll be here if you need further assistance or if you have other questions. I'd be happy to answer them for you. Have a beautiful day ahead.

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