Inventory is maintained
automatically, as long as all related events
are recorded by purchase and sales documents
in QuickBooks. At least three situations
might cause exceptions. The actual
number of items on hand may not be as listed
in the inventory. If you attempt to
sell inventory before you receive it,
QuickBooks has a problem, because the sale
will result in a negative quantity in
inventory. The effect on valuation may
can be made to change the value of the inventory. The
Physical Inventory Worksheet
is handy if inventory parts must be counted. When it is completed, any changes must be entered
Activities|Inventory|Adjust Qty/Value on Hand.
usually receives the name of an expense account for inventory shrinkage.
receives the actual count from inventory.
will be calculated. The difference may
be entered, in which case the new quantity will be calculated.
may be checked for a change in unit value, to reflect rising or falling market conditions.
The columns will be different, adding columns to enter value. Inventory value changes may require caution.
Businesses financed with bank loans may find bankers less than enthusiastic about increases. A devaluation
would decrease taxable income, and might have to be justified to the IRS.