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I am posting this question for a client of mine who is new to QuickBooks and they have asked me to research a setup issue for their company in QuickBooks

2006. They are in the business on buying and selling fuel (gasoline, diesel, kerosene, and heating oil) and they wanted to know the best way to configure their company in QuickBooks for this business. Specifically, they will buy fuel from a vendor and enter that into QuickBooks as a bill. Since they will be reselling the fuel to their customers, it looks like the best way to record this transaction is to setup Items for these expenses and record them in the bill using the Items tab. This has the benefit of enabling them to track the unit cost for the fuel on the bill. They will then select the Customer:Job that they will ultimately resell the fuel to and invoice for the cost of the fuel.

Here is the problem. They buy fuel from multiple vendors. For instance, if they are buying a load of Gasoline (87) from Exxon, the price might be $2.00 per gallon. If they buy a load from B.P. it might be $1.98 per gallon. Now my understanding of the fuel business is that they might buy from several vendors during any given business day. Much of this depends on the price per gallon, the location of the customer that will be receiving the fuel, and the availablility of the fuel type and grade at a particular fuel depot. All that being said, they may purchase fuel from upwards of 15 vendors for resale to more than 100 customers during a business day. Using the Items in QuickBooks 2006, I cannot see how they might handle this. There is a Prefered Vendor field, but since they purchase the same product from so many different vendors, I am not sure if that makes any sense. To complicate matters more, the price of fuel changes during the day since it is a commodity that is actively traded in the markets. They adjust their prices during the day to match any market driven price fluctuations.

Currently, they are not using Items to enter their bills. Instead they are using the values on the invoices that receive from their vendors and entering them in the bills using the Expense tab. Unfortunately, they cannot track the unit price and quantity doing it this way which they would like to do. What they do not want to have to do is create a Gasoline 87 Item for every vendor they buy Gasoline 87 from. This seems like too much work since if they have 15 vendors and 10 fuel types, they would have 150 items to keep up to date. Are there any other options?

Mark

Reply to
Mark D. Lincoln
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Is it necessary to track that Vendor-1 product was sold to Customers A and B, or that product sold to Customer C was purchased from Vendor-1 and Vendor 2? If so, I can see no alternative except creating separate items for each product/vendor combination. If not, why is it a problem that product is purchased from multiple vendors at multiple prices?

The "Preferred Vendor" data is potentially a minor convenience for some businesses, but to the best of my knowledge it has no real functionality and can be disregarded; I certainly cannot see that it presents a problem to your client.

What does your client need that they would not have by creating one item for each type of fuel - 10 items?

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Reply to
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Unfortunately, the fuel business is highly regulated by the Federal, State, and Local governments and they have to track the gallons bought by vendor and depot. They aslo have to track them by customer and location delivered. In addition, they only purchase fuel from a vendor to resell to a specific customer. They never split loads buying half of the load from one vendor and half of the load from another. For instance, if they get an order from a customer in Virginia for 8000 gallons of Gasoline 87, they buy the 8000 gallons from a vendor. If the vendor has a depot in Maryland, they can purchase it there and sell it to the customer in Virginia. They are charged tax on the fuel when they purchase it in Maryland. Then they collect tax from the customer in Virginia which they have to pay to Virginia. At the end of the month, they file tax reports with Maryland and Virginia. Since they collected tax from their customer in Virginia and forwarded it to the State of Virginia, they are due a refund in Maryland since the depot collected the tax when they purchased the fuel from their vendor. It is done this way in most states now since some fuel distributors were scamming the states on tax payments at the end of each month. To make matters worse, the fuel business has the concept of gross gallons and net gallons. Below are the definitions:

a.. "Gross gallon" means the United State volumetric gallon with a liquid capacity of 231 cubic inches a.. "Net gallon" means the gross metered gallon with temperature correction in volume to 60 degrees Fahrenheit

Some vendors sell gross gallons and some sell net gallons. Typically, you pay tax on gross gallons, but there are exceptions. Anyway, that is why they have to track the number of gallons bought by fuel type, grade, and vendor and the number of gallons sold by fuel type, fuel grade, and customer. So, what are their options in QuickBooks 2006?

Mark

"!-!" wrote in message news:EFbCf.24826$ snipped-for-privacy@news20.bellglobal.com...

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Mark D. Lincoln

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