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brassmonkey621
December 11, 2018
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What is the best way to account for product samples expense in QB Enterprise?

  • December 11, 2018
  • 5 replies
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What is the best way to process and account for Product Samples in QB Enterprise? I currently create a $0 invoice to a customer named "SAMPLES" and this takes the item out of inventory and this correctly does not affect my sales for the period. However, it does overstate my COGS. I figured I could just use the Reclassify Transactions tool under Company but that does not allow you to reclassify the account of item-based transactions. I guess I will great a General Journal entry to correct the COGS for the periods that need to be corrected, but how can I avoid this in the future. I need the item to be credit from Inventory and the debit to Samples Expense.
Best answer by Raywhite28
I'd create a few accounts. A Parent account for Product Samples. Then make you sample account a subaccount  for Product Samples. Then create a Freight on Samples account & make that a subaccount  of Product Samples. Then you would know what your samples are actually costing the company.

5 replies

Raywhite28
Raywhite28Answer
December 11, 2018
I'd create a few accounts. A Parent account for Product Samples. Then make you sample account a subaccount  for Product Samples. Then create a Freight on Samples account & make that a subaccount  of Product Samples. Then you would know what your samples are actually costing the company.
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Jabran
December 11, 2018
would that be an Expense account?
Raywhite28
Raywhite28
December 11, 2018
It's just a different way of handling it. Just providing a different option & a way without running an items report on finding out how much samples are costing since a P&L is most likely going to be run.

Also, if you do it in the chart of accounts you can budget on both accounts which you can't do with using items.
qbteachmt
qbteachmt
December 11, 2018

Don't use Journal entries for anything to do with Inventory.

The sales Is impacting your data.

I would use Adjust Inventory, and the offset account can be Advertising and Promotion.

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    brassmonkey621Author
    December 11, 2018
    @qbteachmt Thanks. This does solve the issue with putting the sample product into COGS, but what about tracking the related freight charges that we pay to send the samples to the folks? Should I enter a Bill and use an Item called "Freight" and then assign that cost as a non-billable charge to the final person we are sending the sample to?
    qbteachmt
    qbteachmt
    December 11, 2018

    If you use Items, you can link them to the one account. You can still run reports on Items, to avoid micro-managing the chart of accounts.

    qbteachmt
    qbteachmt
    December 11, 2018

    "but what about tracking the related freight charges that we pay to send the samples to the folks? Should I enter a Bill"

    You enter a bill because you owe for something you don't intend to pay until a later date. Otherwise, you put the charge on the Credit card charge, or a Check entry.

    "and use an Item called "Freight" and then assign that cost as a non-billable charge to the final person we are sending the sample to?"

    I sure would.


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