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QB RECOVERY - Quickbooks Negative Inventory

Quickbooks Negative Inventory is caused by entering sales transactions before entering the corresponding purchase transactions, i.e., you sell inventory items that you do not have in stock.<br>

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QB RECOVERY - Quickbooks Negative Inventory

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  1. QB RECOVERYQuickbooks Negative Inventory QuickBooks Negative inventory causes issues in your company data file. QuickBooks Negative Inventory is caused by entering sales transactions before entering the corresponding purchase transactions, i.e., you sell inventory items that you do not have in stock.This article explains QuickBooks negative inventory - its causes and effects on your company file. It also outlines steps required to fix issues arising from negative inventory.

  2. QuickbooksNegative Inventory WHEN YOU SELL ITEM THAT YOU HAVE ENTERED INTO YOOR COMPANY FILE • You purchase items using the Items Tab on an item receipt, bill, check or a credit card charge, debiting inventory and crediting A/P, Cash, or Credit Card Payable. • You sell items on invoices or on sales receipts, but never more items than you have on hand. • The sales transaction actually records two transactions: • The Sales/Receivable transaction, debiting A/R and crediting Sales • The Inventory/COGS transaction, crediting Inventory and debiting COGS.

  3. QuickbooksNegative Inventory WHEN YOU SELL ITEMS THAT YOU HAVE NOT ENTERED INTO YOUR COMPANY FILE • The invoice records the Sales/Receivable transaction as expected.For the Inventory/COGS transaction, QuickBooks assumes that the average cost of the items not on hand is either: The same average cost as the items you had on hand OR • The Item Cost from the Item List. • QuickBooks records the Inventory/COGS transaction using the assumed cost.

  4. REMINDERS • The Inventory/COGS transaction report never appears on the transaction, but you can see it by running the Transaction Journal report. • Bills, checks and credit card charges with Inventory/COGS adjustments will appear on the Transaction Detail by Account and Account QuickReport for a Cost of Goods Sold (COGS) account.

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