inventory entered on supplies bill not recording in profit and loss

When I enter a bill with stock parts the inventory total is added correctly in the items list but amount is not added into the cost of goods sold (profit and loss), hence the expenditure is under reporting.

After speaking with reckon today they had no answers and suggested we ask the brains trust here.

We have gone through preferences etc. see pic below

Accepted answers

Acctd4

@GlennO As per my previous reply:

It will only work if UOM are used

It reports to COGS ONLY once Items are sold (not on purchase)

😊

All comments

Acctd4

Welcome to the Community @GlennO !

Average Cost

For Inventory Items, average cost is the total cost of items currently in stock divided by total number of items in stock. Reckon Accounts uses "average cost" to determine the value of your inventory.

Reckon Accounts recalculates the average cost of an item every time you record the purchase of more units of the item. It adds the cost of the new items to the cost of the old stock & then divides by the total number of (new + old) items.

Example

You originally bought 100 exhaust pipes at $ 5 each. When you have 10 exhaust pipes left in stock, you order 100 more exhaust pipes, but the price has now gone up to $ 6 each.

Here's how Reckon Accounts calculates the average cost:

The cost of your old stock is $ 50 (10 exhaust pipes x $ 5).
The cost of the new inventory is $ 600 (100 exhaust pipes x $ 6).
The combined cost of the old + new inventory is $ 650.
The average cost of your entire inventory is $ 5.91 ($ 650 / 110 exhaust pipes).

In order for your Inventory to calculate correctly, it's important to identify units of measure (UOM) & record quantities accurately on sales & purchases.

I notice your average cost is the same as your individual Item Cost, despite having 120 in stock. Is that correct ? 😬:

GlennO

This was only done to see if they went into cost of goods sold which they did not. They were purchased once previously and sold.

As mentioned $0 are going into cost of goods sold, nothing is going into cogs of this item

When I enter a bill of 10 items sometimes only 1 will go in yet all are recorded the same as an inventory part.

Acctd4

You need to use UOM, otherwise the system doesn’t know what the relative unit is - eg, each, pair, box, kg etc - & its relevance, in order to determine COGS (as per the above formula) 😬

GlennO

Thanks for your reply

Something is not right here. UOM was not set up in the inventory, so I did set it up on some items a rebooted the computer. I did a couple of dummy bills and it is still not recording to the profit and loss. All inventory quantities have always entered correctly as per units in stock, but nothing in cogs.

The sample i posted was perhaps misleading because these are bought in as single items, as mentioned the quantity of 120 was only put in as a dummy bill as the parts are bought individually and they do cost $784 ea.

It is not reporting at all in the profit and loss cogs, this is the problem

Acctd4

@GlennO As per my previous reply:

It will only work if UOM are used

It reports to COGS ONLY once Items are sold (not on purchase)

😊

GlennO

Thanks again for your help.

I have my quickbooks person coming out to look over it all, as there may be a couple of issues that have been overlooked over many years.

I have looked at all you have suggested and some of the entries that have gone into cogs have had a minus inventory amount, which makes sense.

There does appear to be other discrepancies which we will look at that could be from early entries not recorded properly