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Inventory tracking

Our inventory data in QB has shown unreasonable increases that we can't explain. Upon review, we found that invoices for incoming items were sometimes held up and then entered in groups. Sometimes the invoices were not entered in date sequence. In many cases the invoices were entered after the sales of the items such that we were selling from negative inventory per QB. Ultimately, though, all invoices and sales were dated in QB as they happened. Does the QB inventory system fix itself when all the data is in or does the effect of selling from negative inventory persist?

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When you sell from negative inventory, you create problems in QB. When there is negative inventory, it doesn't know what cost to assign to COGS, so it 'guesses'. This creates a big mess in QB. Just entering the invoice for the purchase of the inventory later doesn't fix everything. You can try entering the invoices as of their proper date, but I suspect you'll still have problems with inventory/COGS. When this happened with one of my clients, we decided that it wouldn't be cheaper and less time consuming to start over with a new file. Good luck!

Michelle L. Long, CPA, MBA Author of: Successful QuickBooks Consulting: The Complete Guide to Starting and Growing a QuickBooks Consulting Business

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Thank you. That explains why we have the mess we do. Looks like we will need to enforce data entries in sequence as they happen once we clear up the current situation. Thanks again.

Al Levesque

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news.verizon.net

When you sell from negative inventory, you create problems in QB. When there is negative inventory, it doesn't know what cost to assign to COGS, so it 'guesses'.

The program uses the default cost entered on the item setup screen when an item with zero or negative count is sold.

When the user later records receipt of said item the prior historical cost of goods sold is replaced with the actual cost entered by the subsequent receipt. If receipts are entered in the correct date sequence the program should end up with the correct inventory quantity, valuation and historical cost of goods sold.

This creates a big mess in QB. Just entering the invoice for the purchase of the inventory later doesn't fix everything. You can try entering the invoices as of their proper date, but I suspect you'll still have problems with inventory/COGS. When this happened with one of my clients, we decided that it wouldn't be cheaper and less time consuming to start over with a new file. Good luck!

Michelle L. Long, CPA, MBA Author of: Successful QuickBooks Consulting: The Complete Guide to Starting and Growing a QuickBooks Consulting Business

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Haskel LaPort

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