QuickBooks for Mac 2014 User’s Guide 183
Hannah sets up her inventory
To see how inventory works, we’ll follow Hannah
who has decided to be her own boss and open a
new store, Illusion Supplies. She’ll be selling tools
of the trade to magicians in North America and
around the world.
Turn on inventory tracking
Hannah creates her company file –
using QuickBooks for Mac of course – and she
turns on Inventory tracking through her
Preferences. When you created your company,
QuickBooks asked whether you tracked inventory.
If you answered Yes, the preference is already
turned on. If you answered No, read on.
To turn inventory tracking on:
1 Choose QuickBooks > Preferences, and then click Inventory.
2 Select the “Inventory and purchase orders are active” checkbox.
Set up vendors
Hannah also uses the Vendor Center to create vendors for three suppliers she plans to use for her inventory:
McCormick’s Wand Supply, Wright Top Hats, Carol’s Rabbit Hutch. Find out about using the Vendor Center on
page 134.
Create inventory items
Hannah creates inventory items for wands, top hats, and rabbits. When she creates the items, she chooses
“Inventory Part” as item type because she plans to resell these items. QuickBooks will track how many inventory
items remain in stock after a sale, how many items she has on order, her cost of goods sold, and the value of her
inventory. When she creates her items, she has the option to select one of her vendors as a preferred vendor for
that item. To learn how to create an inventory item, see page 62.
Set up accounts
Hannah also makes sure she has these accounts in her Chart of Accounts:
• Inventory Asset, which is an Other Current Asset account, to track the current value of her inventory. This is
created automatically when Hannah creates an inventory part.
• Sales, an Income account, to track the income from the sale of her inventory items. If you sell both items and
services, you may want to use a Sales account for each, depending on what works best for your business.
• Because she’s created an inventory item, QuickBooks automatically creates a Cost of Goods Sold account to
track the costs to Hannah of the items she’s selling.
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