Skip to main content
B
Bajadreamer
September 2, 2022
Solved

Inventory-where should the value be at the end of year? Should it be listed as an assett or simple equity?

  • September 2, 2022
  • 1 reply
  • 0 views

Let me preface this and say my QB does not interface anywhere and I use it strictly for personal use.  No accountant ever see's this.

 

My question is this-
At the end of year I have approx $69,000 of inventory that will be sold next year. 
It was already expensed in the current year as COGS.  
Is it proper to have this listed on my balance sheet as an asset?  If so what account would I offset it as, retained income? Then once it is sold then I would do a GJ to remove the asset and and offset it to income, correct

Best answer by BigRedConsulting

Inventory should only be expensed to Cost of Goods Sold when you sell it.  Before that, when you've purchased it and not sold it, it's an asset on your Balance Sheet.

1 reply

BigRedConsulting
BigRedConsultingAnswer
September 2, 2022

Inventory should only be expensed to Cost of Goods Sold when you sell it.  Before that, when you've purchased it and not sold it, it's an asset on your Balance Sheet.

B
BajadreamerAuthor
September 3, 2022

Thank you!  So it looks like going forward I will enter all purchases as asset, then at end of each month I could do a GJ to reduce the asset and increase the COGS of all items.  By doing this it should give me a clearer picture of business 

BigRedConsulting
BigRedConsulting
September 3, 2022

Yes. Or, you could use the inventory items built into QuickBooks on your purchases and sales. QuickBooks will then handle the accounting for you automatically, calculating the COGS for you as you enter sales.

Terms & ConditionsAccessibility statement