Inventory on Hand to Cost of Goods Sold

  • 1
  • Question
  • Updated 1 year ago
  • Answered
Hi

Using Reckon one for game store. When we set up the items our buying account is Inventory on hand and the selling account is sales. 

When an item is sold the total sale price goes through as income, on the profit and loss it shows the full income as profit it does not deduct the initial purchase price. 

Does anyone know how this should be set up? I have spent an hour on the phone to Reckon and he was not able to help. 

Also we are looking at creataCRM for our inventory management has anyone had any experience with this?

Thanks 
Photo of jaya

jaya

  • 70 Points
  • Frustrated

Posted 1 year ago

  • 1
Photo of John G

John G, Information Support Analyst

  • 27,360 Points 20k badge 2x thumb
Hello Jaya,

Welcome to the Reckon Community.

Cost of Goods Sold is currently a manual process as Reckon One does not have an Inventory capability.

Item setup does allow you to set an item as "Buy and Sell" and set your buy price, tax code and account separately from the sale price, tax code and account.

The account for purchases should be a balance sheet account like "Purchases" and you should not use Cost of Goods Sold here for the time being.

At the end of the reporting period you will need to do a stock take or make some sort of assessment of the cost of the goods you sold in the period.  Please see your Accountant for directions on this process.  Use a General Journal to move the determined amount from the "Purchases" account to the "Cost of Goods Sold" account which appears on the P&L report to produce your Gross Profit figure.  

Hope this helps.


regards,
John
(Edited)