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Question

I need to enter a journal entry including an inventory item, but it isn't given by QBO as an option. How can I enter it in the Journal Entry?

Forum|Forum|6 years ago
March 11, 2020
4 replies
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QuickBooks Online

Level 5

Hello Verdickmoja,

Welcome to the QuickBooks Community! I would suggest following these steps, but this only work for the inventory asset account:

1. Create the journal entry by selecting +New and clicking Journal Entry.
2. Select Inventory Asset account and enter in the description the name of the inventory item.
3. Add the necessary information and save it.

However, I advise getting with your accountant to confirm that this would be acceptable for your business. If you don't have an accountant, you could connect with a ProAdvisor specialist. They offer a free consultation to businesses. Simply enter your zip code and search to find one near you.
Keep me updated!

Level 15

NO, you never ever us a journal entry for inventory items - It will not work and WILL mess up the balance sheet.

Never use journal entry for inventory it will not work to affect qty or cost but will misstate the balance sheet amount for inventory asset.

QB is not a journal entry type of software. Use the menus and forms, QB does the journal entry behind the scenes.

Journal entries should be the exception when using QB, they often do not work as you think they should, and when you use inventory type items they never work for inventory. It is much better to use the forms on the home page the way QB is designed to be used. Journal entries also bypass accrual/cash reporting, and will not show on many reports.

Lets say I started using quickbooks in 2016. Before that I had many fixed assets in my asset account. Since journal entries dont allow us to associate previous amounts with fixed asset items how can we do this in quickbooks? We cannot enter a payment or bill anymore. It is in the past.

Level 7

"I need to enter a journal entry including an inventory item, but it isn't given by QBO as an option. How can I enter it in the Journal Entry?"

You can't. You never want to use a Journal Entry for product/service inventory items. You will need to follow the proper workflow for adding inventory items in QBO.

You can refer to this helpful article:

https://quickbooks.intuit.com/learn-support/en-us/set-up-inventory-lists/set-up-and-track-your-inventory/00/186430

Hope this helps!

Hi there,

I am trying to bulk record my inventory quantities every month. I record all sales etc through a journal entry however that does no track/record my inventory. What is the best way to record inventory quantities?

Thanks!

Level 8

Nice to have you joined this thread, Jaimee.

You can enter an Inventory Qty Adjustment to seamlessly record your inventory quantities. Let me show you how.

Sign in to your QuickBooks Online (QBO) account then go to the + New menu.
Select Inventory Qty Adjustment.
Enter the Adjustment Date.
In the Inventory adjustment account drop-down, select the appropriate account.
Select the products in the Product field.
For each item, enter either a new quantity or a change in quantity.
In the Memo field, enter the details about the adjustment (optional).
Then click Save and close.

For more insights, you can also refer to this article: Adjust inventory quantity on hand in QuickBooks Online.

Moreover, I’m adding this link that can guide you on how to track your inventory efficiently: Set up and track your inventory in QuickBooks Online.

Keep in touch with me if you have other queries managing your inventories or with your account. I’ll be around ready to assist you. Keep safe!

Eleanor Cleverence

You've hit on a tricky part of QuickBooks! When you're messing with journal entries involving inventory items, you're gettin' into a complex area that needs some care. Let's break it down. Usually, inventory items are tied to how QuickBooks keeps track of quanitty and financial value. So when using journal entries, you bypass some of those built-in checks that maintain alignment.

Here’s what ya gotta watch for: QuickBooks prefers to keep inventory tied to purchasing, sales, or inventory adjustments within its modules. If you're throwing a journal entry that includes inventory, you might be getting quantities all misaligned with their financial values. Check if there's a specific reason you have to use this method - often, an inventory adjustment or sales/purchase form might do the trick.

If you have to go the journal entry route, make sure to track both inventory asset account and something like Cost of Goods Sold or Income to reflect the transaction right. Be careful, though - errors here can mess up your financials. It's useful to talk to someone who knows both accounting and QuickBooks to sidestep these issues. And hey, if you've got advanced inventory enabled, be extra careful, this could really complicate things.