What is the right away way to set-up inventory in QuickBooks Online Plus?

Heard it will create a mess if initial setup is not proper.

GO to Company Gear (located top right corner)

Select Products and Services under Lists

Click New

New screen will pop out

Name = Name of Inventory

Checkbox “I track on hand for this product…..”

IMPORTANT AND COMMON MISTAKE: If you did not checked this box and entered initial quantity on hand (even if it’s zero ’cause it’s new item) and later entered bill or entered check; added inventory purchases will just posted to P&L Expense under Purchases account that is their default account.

Initial Quantity on Hand = enter “0” even if it’s none; enter actual quantity on hand if available (also important, it’s quirky if you have to come back and adjust quantity again)

As of Date = today or when physical inventory was taken

Inventory Asset Account = Inventory Asset (default account)

Sales Information = This is the information will show up as description customer sales invoice

Purchasing Information = This is the information will show up as description of vendor purchase order

Price = Sellling Price

Cost = Purchase Price (estimated purchase price will do if actual price vary)

Income Account = Income Account which will show as Income category in P&L

Expense Account = Cost of Good Sold (default)


For detailed instructional guide regarding these topics, you can also checkout our top-rated YouTube videos published for new QuickBooks Online users.

QuickBooks Online: How to import Inventory with Quantity on Hand from Excel into new QBO?

QuickBooks Online Plus: how to add beginning inventory quantity on hand?

QuickBooks Online (QBO) Tutorial – Customer Invoice, Sales Receipt, Receive Payment, Bank Deposit

New QuickBooks Online Plus – How to enter various expenses in new QBO?

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