I see where QB (2004 Premier) sets up an account 4010 for Merchandise. I use non inventory items and wonder if they should be set to COGS or Sales. I do inventory some items but they change constantly so I use generic names and then under description, I list what the item is. I have about 10 different non inventory items. Which account should they be listed to....COGS or Sales? Thanks for helping a helpless person.
Non-inventory items that are used only on invoices or sales receipts (not on checks or bills) should be assigned to Sales. Non-inventory items that are used on checks or bills but NOT on invoices or sales receipts should be assigned to COGS or an expense account. You can assign an item to BOTH sales and COGS by selecting the option "This item is purchased for and sold to a specific customer" - I personally think the description stinks, but anyway that's what it's for.
It's logical - if you are accounting for the sale of an item, it should be assigned to Sales. If you are accounting for a purchase, it should be assigned to COGS or an expense.
Merchandise. I
generic names
Thanks, it does make sense but that doesn't always mean something.
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