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tburch
February 22, 2023
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Inventory Adjustment with New Cost

  • February 22, 2023
  • 2 replies
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One of my clients contributed to the company by purchasing additional inventory; this inventory had a different cost than the first purchase. I wanted to use the "Adjust qty" feature via the Products and Services list so that I could both add to the specific inventory item purchased and reflect the increase in equity.

 

The entry does not correctly calculate the new cost price when using the "Adjust qty" option via the Products and Services list.

 

I updated the product cost to the latest purchase batch ($6.625), which should have adjusted the specific inventory item from 40 units to 60 units, and the adjustment amount should have totaled $132.50 ($6.625*20 units). For some reason, it only correctly adjusts the units, and the dollar amount for the adjustment is incorrect (it totals $151.46 or $7.573 per unit).

 

How can I use the "Adjust qty" (NOT a purchase order or simple journal entry) to correctly update the inventory item?

 

Please see the relevant screenshots:

 

 

 

Best answer by Rainflurry

@tburch 

 

Create an expense or check transaction for the items and use a bank Clearing Account as the payment method.  If you don't have a Clearing Account, set one up.  That will receive the items in inventory.  Then, transfer the amount from the Clearing Account to the appropriate equity account.  You can use a transfer (New > Transfer) or make a journal entry - debit Clearing Account and credit the appropriate equity account.   

2 replies

D
DebSheenD
February 22, 2023

Hello there, @tburch.

 

I'm here to share some details about changing the quantity of your inventory items in QuickBooks Online (QBO).

 

Normally, changing the quantity of your Inventory in QBO doesn't affect the cost of it. Ensure to check the as of  date  when editing it in QBO,

 

You can follow the steps below on how to add an inventory quantity adjustment:
 

  1. Go to the + New button and tap Inventory Qty Adjustment. 
  2. On the Inventory Quantity Adjustment page that appears, set the Adjustment Date.
  3. Proceed to the Inventory adjustment account drop-down and select the appropriate account.
  4. Enter the products in the Product field drop-down.
  5. Provide a new quantity or a change in quantity.
  6. Click Save and close once you're done. 
     

Here's the adjust inventory quantity on hand in QuickBooks Online article for more information. 

 

Also, here’s more information on how to enter product and service items you buy and sell: Add product and service items to QuickBooks Online.

 

I'm always here if you have follow-up questions about inventory management. Take care and have a wonderful day!

Rainflurry
RainflurryAnswer
February 22, 2023

@tburch 

 

Create an expense or check transaction for the items and use a bank Clearing Account as the payment method.  If you don't have a Clearing Account, set one up.  That will receive the items in inventory.  Then, transfer the amount from the Clearing Account to the appropriate equity account.  You can use a transfer (New > Transfer) or make a journal entry - debit Clearing Account and credit the appropriate equity account.   

AlcaeusF
AlcaeusF
March 6, 2023

Hi again, Rainflurry.

 

I appreciate you for always sharing your knowledge about QuickBooks. This will definitely help other users as well in the future. Please keep on posting here in the Community.

 

Keep safe and have a great rest of the day.

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