QuickBooks Online – Account setup for Periodic Inventory basis in QBO

NEW!! QuickBooks Online Inventory Deep Dive

Deep Dive into QuickBooks Online Inventory

One time test drive or 30-day free trial link:


Table of Contents

00:00 Intro
00:14 Brief Notes On QuickBooks Online Inventory History
01:33 Which QBO version allows Inventory tracking?
02:04 Test Drive One Time or 30-Day Free Trial
05:16 Turning the Gear Settings on in your account
05:24 Add your new Inventory products/items
14:41 Mapping your Inventory Items
16:14 “Initial quantity on hand” and “As of date” fields on the Product/Service information page
19:02 Entering your Inventory Purchases on the ITEM DETAILS tab
26:28 Selling your Inventory Products (Create an Invoice or Add a Sales Receipt)
30:06 Understanding Debits and Credits of Buying and Selling Inventory Products
31:51 What is FIFO and how is it used for the inventory cost of goods sold?
38:59 How to make inventory Qty Adjustments (One Item or Batch of Items)
44:16 Non-Posting type – Create an Estimate, Convert Estimate to PO, Create the Purchase Order (PO)
45:43 How to handle Inventory purchased items in the Bank Feed?
48:49 Running Inventory Reports
53:04 Restock your inventory items – Low stock or Out of stock
54:43 Create Bundle – a kit or a bundle of different products
57:57 Import products through CSV files

If you’re adopting a “Periodic Inventory” basis, do not select “Inventory as Detail Type” in the Chart of Accounts. Instead, use Other Current Assets for Detail Type and for the Category Type, Purchases as the account name. For the Detail Type, you never want to use “Inventory Asset”, this happens to be the default account name designated for Perpetual Inventory tracking in QBO. If you want to switch later, it creates problems.

Periodic Inventory basis account setup