I probably set up the chart incorrectly, and can't figure out how to correct it. Here's what I have:
Our non-profit organization has income from a variety of sources (contributions, memberships, etc.. It also has sales from a gift shop. Each of these categories has its own income account with account type "Income". There's also a cost of sales account for the gift shop with account type "cost of sales"
During the year, we post all gift shop sales to the "gift shop sales" income account. We post inventory purchase to the Inventory balance sheet account. At year end we post an adjusting journal entry of the form:
Cost of sales xxxxx Inventory xxxxx.
I end up with the correct year end P & L and Balance Sheet figures. But the P & L report layout is not in the normal form. Instead I end up with:
Income Income1 xxxx Income2 xxxx etc... Income 10 xxxx Gift shop sales xxxx Total Income xxxx
Cost of sales Cost of sales xxxx Total Cost of Sales xxxx
Gross profit xxxx (which is then the sum of all the income account balances minus the COGS)
I'd normally expect the cost of sales to be "attached" only to the gift shop sales, with the gift shop gross profit being the difference.
Should I have labeled all the other income accounts as "Other Income"? If so, can the account types be changed after the fact?