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Question About "Customer/Vendor Inventory Items"

I am new to Quickbooks, and am using the 2005 Pro edition.

I am trying to set up my husband's business in Quickbooks, and I am very confused about how to handle a certain customer/vendor inventory item.

He BUYS mulch from a vendor by the tractor load, but he SELLS mulch to his customers by the bucket.

The problem is... When he buys mulch by the tractor load, he has no idea how many buckets the load actually contained until he sells it all. Sometimes a tractor load will contain 80 buckets, but sometimes it contains 110 buckets.

I have created a customer item for "Mulch, 1 bucket" for $10 to handle the sales. But when he purchases the mulch from a vendor, however, how do I show this? (I have been estimating the items at 100 buckets, but this is too approximate to work over the long-term.)

I would really appreciate someone's ideas on this! Many thanks!

Jessi

You sell the mulch, however, you're selling by the bucket. When you create "items" to choose from when you buy from a vendor and sell to a customer, how is this resolved? (You're not buying it by the bucket, so you don't know how many buckets you bought until you sell it all. You really have no idea how many buckets you're getting because it could be off as much as 20-30 buckets.)

Reply to
JessiRight77
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Create just one item. So that you are not consistently told that you don't have enough product on-hand (by recording one load and trying to sell individual buckets), I'd recommend using a "Non-Inventory Item" for your mulch. Inside the Item setup window you'll need to check the box that says "This item is purchased for and sold to a specific customer/job." This will open up the bottom of the screen to allow for cost/sale information.

If the tractor-load price is always the same you can enter it as the cost. Generally the Expense Account is Cost of Goods Sold. You can enter the vendor's name if you choose but its not necessary.

On the right side enter the price per bucket you sell to customers. Select whether or not you generally tax the bucket loads. The Income account is whatever general Sales account you setup.

Reply to
Tee

Okay... so if I understand correctly, I should stick with the individual "bucket-size" item, and if I buy a trailer load, I should just guestimate at 100 buckets. I tried to change the item from "inventory" to "non-inventory," but it wouldn't let me.

Thanks so much for your help!

Jessi

Reply to
JessiRight77

No, don't try to guesstimate buckets. Setup one Non-Inventory Item with the checkbox checked. On the left side of the bottom of the screen enter a cost per truckload of $100 or whatever the bulk load costs you (if its standard, otherwise leave it zero) and assign the cost account to Cost of Goods Sold. On the right side assign the cost per bucket, whether you charge tax, and assign an income account.

It'll look like you're taking a huge loss just going by those numbers if buying it costs $100 and selling it brings in $10 per bucket. However, we know that's not the case because you'll sell many buckets from just one purchase. That's why you use a Non-inventory item. It will allow you to enter a bill, or write a check, for 1 Mulch at $100. It'll allow you to enter an invoice or sales receipt selling 20 Mulch (buckets) at $10ea.

In other words you can buy one but sell many using this item type. It won't track in inventory because its not an inventory item but since you don't get an exact number of buckets per truckload each time you realistically cannot tell QB how many you have on hand.

Reply to
Tee

Okay.... Thanks very much!!

Jessi

Reply to
JessiRight77

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