Add Inventory Assembly Items in QuickBooks Premier
To account for the manufacture of inventory in QuickBooks Premier, you add inventory assembly items to the Item list for those items that you manufacture. To describe manufactured items, follow these steps:
Choose Lists→Item List.
QuickBooks displays the Item List window.
Click the Item button in the Item List window and select New from the drop-down list.
QuickBooks displays the New Item window.
Select the Inventory Assembly item from the Type drop-down list.
QuickBooks displays the Inventory Assembly version of the New Item window.
Specify the account to use for tracking this item’s cost when you sell it.
QuickBooks suggests the Cost of Goods Sold account. If you’ve created other accounts for your COGS, however, select the other appropriate account.
Describe the manufactured item.
Type in a description of the item that you want to appear on documents, such as invoices and so on, that your customers see. (QuickBooks suggests the same description that you used in the Description on Purchase Transactions text box as a default.)
Enter the amount that you charge for the item into the Sales Price box.
Indicate whether the manufactured item is subject to sales tax using the Tax Code box.
Use the Income Account box to specify the account that you want QuickBooks to use for tracking the income from the sale of the item.
Identify the components that go into the finished item.
Use the Components Needed list to identify the individual component items and the quantities needed to make the inventory assembly. Each component item goes on a separate line in the list. Not to be too redundant, but do note that you identify both the component item and the number of component items needed.
Identify the Asset Account.
Specify the other current asset account that you want QuickBooks to use for tracking this inventory item’s value.
Select a Build Point.
Use the Build Point box to specify the lowest inventory quantity of this item that can remain before you manufacture more. When the inventory level drops to this quantity, QuickBooks adds a Reminder to the Reminders list, notifying you that you need to make more of the item.
Ignore the On Hand and the Total Value boxes.
See that On Hand box? Leave it set to zero. To enter a number now is to record an uncategorized transaction, and you don’t want to do that. Go ahead and leave the Total Value field set to zero, too. You can also leave the As Of box empty, or you can enter the current date here. It doesn’t matter.