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What Is an Inventory Part?

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An Inventory Part is one type of Item and is maintained on the Lists->Item List menu selection.

See our article on all of the Item types supported by QuickBooks for more information.

Generally speaking, Items are designed to pre-fill invoicing and purchasing forms. An Inventory Part represents an item that your firm keeps on hand for sale to customers. It can be stocked and sold on its own or included as part of an inventory assembly.

Here’s a screenshot of the QuickBooks Item List showing a range of inventory parts:

QuickBooks 2011 Item List Inventory Parts

QuickBooks tracks certain information that apply only to Inventory Parts. Fields tracked only for Inventory Parts include:

  • Quantity On Hand
  • Quantity On Purchase Order
  • Quantity On Sales Order
  • Reorder Point
  • Asset Account

Some fields are tracked both for Inventory Parts and other item types, such as Inventory Assemblies and Non-Inventory Parts. Some – but not all – of these fields also may be tracked for other item types if you select the checkbox This item is used in assemblies or is a reimbursable charge. These fields are:

  • Quantity On Pending Builds
  • COGS Account
  • Preferred Vendor

The above screenshot shows a mix of inventory parts and sub-items of inventory parts. This structure is often described as a “parent child relationship”, where a sub-item is a child of its parent. While both parent and child items are labeled as Inventory Parts, QuickBooks only tracks quantity information for sub-items (i. e., child items) when this structure is used. It does not aggregate information for parent items where sub-items exist for that parent item.


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How Do I Collect and Track Sales Tax?

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The first step to collect and track sales tax in QuickBooks is to enable the preference to do so.

On the Edit->Preferences menu, select the Company Preferences tab on the Sales Tax submenu.

Click Yes on the Do you charge sales tax? preference.

QuickBooks Enterprise Solutions 10 Preferences Sales Tax

Once the preference is set, you use:

  • sales tax codes to specify whether a customer or item is or is not taxable
  • sales tax items to specify the sales tax applicable to a customer or invoice
  • sales tax groups to combine multiple sales tax items into a combined rate for a customer or invoice

To collect and track sales tax, you’ll need to create at least 1 sales tax item, which you can do directly from the Preferences window.

QuickBooks Premier 2009 Preferences Sales Tax Items

If you are changing your sales tax preference after you’ve already created customers, inventory, or non-inventory parts, you’ll be given the opportunity to change the tax status of those existing customers and items.  When the Updating Sales Tax window appears, choose what you’d like to update and click Ok.

QuickBooks Premier 2009 Updating Sales Tax

This update process will update all customers and all items that are either an inventory part or non-inventory part, so make your decision to update carefully.  Decide based on the characteristics for the bulk of your customers or inventory items, because the exceptions will have to be reviewed and changed individually.

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What Data Is Exchanged Between POS and QuickBooks Financial Software?

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When you enable the company preference Use with QuickBooks Financial Software on the Edit->Preferences->Company->Financial menu, certain information is exchanged between POS and QuickBooks financial software.

POS 8 Company Preferences Use QuickBooks

Exchanges take place by initiating the exchange from POS by clicking on the menu Financial->Update QuickBooks.

The results of a successful exchange are shown below.

QuickBooks POS 8 Financial Exchange

The Financial Exchange window summarizes what has been exchanged.

Some information is exchanged in both directions:

  • customer information excluding account balances
  • active vendor information

Once POS is installed and running, inventory transactions are managed in POS. Therefore, most information exchanges occur from POS to QuickBooks. These exchanges are:

  • customer payments
  • cash register payouts
  • sales and order deposits
  • receiving vouchers
  • financial impact of inventory adjustments
  • freight charges on inventory transfers between stores (POS Pro Multi-store)
  • time clock records (POS Pro)

To provide the ability for management to record some transactions that affect account balances and change customer credit limits, QuickBooks financial software exchanges this information to POS:

  • customer account balances
  • customer credit limits

Certain information is not exchanged in either direction:

  • inventory items and quantities after the initial import from QuickBooks financial software to POS
  • employees
  • employee commissions and tips
  • purchase orders

This information is summarized in this Intuit knowledge base article.

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Zoovy Web Store

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A web-savvy client just drew our attention to a QuickBooks compatible web store, Zoovy.

The company says they support bi-directional communication of invoices, sales receipts, customers, products and inventory with QuickBooks in this Zoovy overview.

For QuickBooks customers looking to increase sales from a web store and not have to re-enter information, Zoovy might be worth a closer look.

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What Is an Inventory Assembly Item?

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In QuickBooks an inventory assembly item is a specific type of Item that is the result of putting together a new inventory part out of a bundle of individual items to enable tracking finished goods separately from individual components. Normally, an inventory assembly item is used when separate raw materials are assembled, packaged, and sold as an inventory item that is separate from the component parts.

See our article on all of the Item types supported by QuickBooks for more information.

The inventory assembly item type is only available in QuickBooks Premier and Enterprise Solutions.  It’s not available in QuickBooks Pro.

It is similar to – but different from – a group item, another approach to managing a bundle of individual items. A group item is a way to quickly add a bundle of items to a form while preserving the ability to track those items individually. Where an inventory assembly item functions like a pre-assembled kit, a group item functions like an “on the fly” kit.

An inventory assembly item is made up of a Bill of Materials (visible by clicking the Full View… button) which can contain a range of item types: service, inventory part, another inventory assembly, non-inventory part, and other charge. Note that a subassembly can be nested within an inventory assembly. However, the Bill of Materials cannot contain these item types: subtotal, group, discount, payment, sales tax item, or sales tax group.  Further, there’s a limit of 100 items in the Bill of Materials for an inventory assembly in QuickBooks Premier; for Enterprise Solutions, that limit is 500 items.

QuickBooks Premier 2009 Bill of Materials Full View

The Cost shown for an inventory assembly item should normally not be entered. When a Cost is not entered, QuickBooks will use the Bill of Materials Cost that appears at the bottom of the table.

An inventory assembly is built from its components parts by clicking on the Vendors->Inventory Activities->Build Assemblies menu selection. During the build process, the Quantity on Hand of the inventory assembly item is increased by the Quantity to Build, and the Quantity on Hand of each component is reduced by the product of that item’s Qty in the Bill of Materials and the Quantity to Build.

QuickBooks Premier 2009 Bill of Materials Full View

Builds in QuickBooks can be either pending or final. If there are insufficient quantities of the component parts, a build will automatically be marked as Pending. You can also manually mark a build as pending by clicking on the Edit->Mark Build As Pending menu selection while the Build Assemblies window is displayed. The Pending Builds report (Reports->Inventory->Pending Builds) supports managing future build requirements.

Here’s an example of invoicing for the inventory assembly item Interior Door kit shown above. Unlike a group item, which automatically adds other items to a form and controls whether these other items are printed, the inventory assembly item appears as a single line item on a form.

QuickBooks Premier 2009 Create Invoices Inventory Assembly Item

The price of an inventory assembly item is specified, just like the price of an inventory item, and can be changed directly on a form.

Sales tax for an inventory assembly item is calculated based on the single Tax Code assigned to the inventory assembly.

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