How to Set Up COGS (Cost of Goods Sold) in QuickBooks?

Cost of Goods Sold, also called COGS monitors all the expenses related with t items that are sold, allowing you […]

Voiced by Amazon Polly

Cost of Goods Sold, also called COGS monitors all the expenses related with t items that are sold, allowing you to determine the precise gross profit. COGS accounts also provide the overall underlying expenses on your particular Profit and Loss reports.

Save Time, Reduce Errors, and Improve Accuracy

Dancing Numbers helps small businesses, entrepreneurs, and CPAs to do smart transferring of data to and from QuickBooks Desktop. Utilize import, export, and delete services of Dancing Numbers software.

In QuickBooks, a user needs to devise new accounts via the Chart of Accounts screen. You then allocate the required inventory items to such accounts in order to track precisely your stock and what you have in it and also learn precisely how much you have earned and spent.

What is Cost of Goods Sold in QuickBooks

Cost of goods sold (COGS) is a financial metric used to measure the direct costs associated with producing and selling a product or service. In QuickBooks, the cost of goods sold can be calculated by tracking the expenses that are directly related to the production and sale of your products or services. This includes things like raw materials, direct labor, and any other costs that can be directly attributed to the creation and sale of your products.

To track COGS in QuickBooks, You’ll need to set up a system for recording all of your relevant expenses. This may involve creating specific accounts for different types of costs, and then entering transactions into QuickBooks to reflect these costs. You can also use QuickBooks to generate reports that help you understand your COGS and other financial metrics, So that you can make informed decisions about your business.

How to Set up or Create COGS in QuickBooks?

To create COGS in QuickBooks, A user needs to follow certain steps below in the given manner:

Step 1: Press Lists on the menu and after that press Chart of Accounts.

Step 2: Press the Account menu item on the screen that appears and then press New to open the Add New Account screen.

Step 3: Choose the button Other Account Types and press Cost of Goods Sold from the given drop-down list and then press Continue.

Step 4: Enter a Chart of Accounts number in the given text box for Number in case you use account numbering.

Step 5: Enter a name in the text box for Account Name and then choose a currency from the drop-down menu of Currency.

Step 6: Add the remaining text values as required in the given Optional area of the screen. Press the Save and Close button and choose your new account.

How to Adjust COGS in QuickBooks?

In order to adjust COGS in QuickBooks, You need to authenticate the right cost of the Item sold with the help of the following steps:

Step 1: In the Reports tab, Press Sales and choose Item Summary.

Step 2: Press Modify and then choose Revert.

Step 3: From the particular Item Name area, classify the items.

Step 4: Now, search any items that have USD 0.0 in the given section for Ext Cost.

Step 5: In the inventory section, Choose the Item List.

Step 6: Press Edit on every item and then first review the item history to determine the number of items that have been sold out minus a cost.

Step 7: Determine the amount of the items that have been sold without cost.

Step 8: Now, from the QuickBooks Desktop Journal Entry area, make a new journal entry that will credit the COGS account with the amount that is debited from the particular Inventory Assets.

QuickBooks Build Assembly Cost of Goods Sold

Building assemblies mean setting up the reorder level in the QuickBooks. In this article, we will guide you how you can build assemblies in QuickBooks and how the same affects the cost of goods sold. Building assemblies are based on a very simple concept. You need to make a group of several inventory items that you can order together. Before you begin with the process of building assemblies you need to be well prepared. You should create a detailed record of all the items in the assembly that you wish to combine together. After the same is done go further with the following steps to create assemblies.

Steps to Build Assemblies in QuickBooks Cost of Goods Sold

  • Go to the vendors menu and select Inventory activities.
  • Under inventory, Activities open the Build Assemblies.
  • Under the build assembly, Dialogue box click on the drop-down menu box beside the assembly item and click on Add new.
  • A new dialogue box will open up where the Inventory Assembly will be highlighted. Click on that and enter item name/number in that field.
  • Mostly you would not be filling in the cost field but you might require giving a detailed description of the inventory.
  • Select the correct Cost of Goods Sold (COGS) account in the field COGS account.
  • Now go to the Bill of materials (BOM) filed. In the space under it go to the item field and click on down arrow to open the inventory list. Enter the first item in your assembly list and fill in the Quantity.
  • Repeat step 7 to add all the items in your assembly list. QuickBooks enables us to keep a running tally of all the items in the assembly. Also, It keeps a total of the bill of a material box.
  • Now the assembly build has been created. In the Build, Point field enter the quantity of the new builds that have to be ordered. Just in case you are aware how many builds you have in hand enter the same in the builds in hand column. QuickBooks will show the value of total builds in hand. You can also add a reorder level, The build going below which will be triggered for a reorder.
  • Now you can go back and decide a sales price which is cost plus profit. Click on Ok.
  • The next screen will ask you how many builds you wish to reorder. Enter it and you are done.

With the steps stated above, you can easily handle the process to set up COGS in QuickBooks. We have made sure that we highlight everything related to setting up COGS in QuickBooks to adjusting COGS in QuickBooks. Just make sure you follow them correctly.

Accounting Professionals, CPA, Enterprises, Owners
Accounting Professionals

Looking for a professional expert to get the right assistance for your problems? Here, we have a team of professional and experienced team members to fix your technical, functional, data transfer, installation, update, upgrade, or data migrations errors. We are here at Dancing Numbers available to assist you with all your queries. To fix these queries you can get in touch with us via a toll-free number
+1-800-596-0806 or chat with experts.


Frequently Asked Questions (Faqs)

What is the Difference Between Expenses and COGS?

For a COGS part, It must be used up in service or sale. However, If you give money to a subcontractor for a certain task, then his cost is considered COGS. Furthermore, the cost of the shipping of the particular product to the clients is also COGS. However, Small tools are considered expenses and not COGS.

What are the Causes of Wrong COGS in QuickBooks?

There can be various causes why the COGS amount is not in sync with the amount that is displayed in QuickBooks Desktop POS. Such reasons for incorrect COGS include:

It is quite likely that the incorrect COGS account is used by the QuickBooks Desktop POS to get the data.
The wrong cost has been added for the items that have been received.
Unintentional deletion of those transactions that are registered in QuickBooks Desktop POS.
When you fail to set up the particular cost for a given item and add it right after the conducted sale.
When you buy items in bulk and then sell them one at a time.
Changes in the COGS account not being shown in the POS can also give rise to the wrong QuickBooks COGS problem.

What are QuickBooks Items in the General Sense?

For every user, QuickBooks Items can be classified as categories of kinds of products and services that a company offers. Items are needed in QuickBooks, since they are used while making sales receipts, Credit Memos, invoices, refunds, etc.

Furthermore, every item is connected to an account, typically a revenue account. Several items have been linked with the same account. On top of that, many businesses have more than hundreds of items per income account.

How to Ensure the Accurate or Right Cost of Goods Sold Account is set up in the Settings?

Here are the steps to ensure the accurate or right Cost of Goods Sold account is set up in the Settings:

Step 1: Open the particular QuickBooks Point of Sale and in the File tab, Press Preferences and choose Company.

Step 2: Press Financial and then choose Accounts.

Step 3: Confirm the right COGS account that is chosen for every item that is listed.

Step 4: Now, in the Inventory section, Press Item List.

Step 5: In the Column Header, Select Customize Columns and then see if the right Cost of Goods Sold account is set or not.

Step 6: In case there is a wrong COGS account in the set up under Settings, then press Item List and select the right COGS account.

Step 7: Now open the QuickBooks Desktop and create a Journal Entry to shift the amount to the right COGS account.

How to Delete any Adjustment Done with POS Errors?

Here is how you can remove any adjustments done with the Error in POS:

Step 1: Open the QuickBooks Point of Sale. Then, In the Inventory section choose Quantity Adjustment History.

Step 2: Press Customize Column from the particular Column Header.

Step 3: Now, enter a Diff Cost in the particular column that is chosen and press Save.

Step 4: Take a note of the quantity adjustments that were done by mistakes from the section Diff Cost.

Step 5: To see the account where the funds are sent, Press an entry twice and then click, I want to see the Financial History.

Step 6: Select the option that says Open in QuickBooks. Now press Inventory and choose Cost Adjustment History.

Step 7: If you see any adjustment that was done by mistake, Press I want to add and then choose Reverse Memo from the Cost Adjustment history.

Step 8: Now make a journal in QuickBooks Desktop in order to move the money into the right account.

Features of Dancing Numbers for QuickBooks Desktop

Imports

Imports

Exports

Exports

Deletes

Deletes

Customization

Customization

Supported Entities/Lists

Dancing Numbers supports all QuickBooks entities that are mentioned below:-

Customer Transactions

Invoice
Receive Payment
Estimate
Credit Memo/Return Receipt
Sales Receipt
Sales Order
Statement Charge

Vendor Transactions

Bill
Bill Payment
Purchase Order
Item Receipt
Vendor Credit

Banking Transactions

Check
Journal Entry
Deposit
Transfer Funds
Bank Statement
Credit Card Statement
Credit Card Charge
Credit Card Credit

Employee Transaction / List

Time Tracking
Employee Payroll
Wage Items

Others

Inventory Adjustment
Inventory Transfer
Vehicle Mileage

Technical Details

Easy Process

Bulk import, export, and deletion can be performed with simply one-click. A simplified process ensures that you will be able to focus on the core work.

Error Free

Worried about losing time with an error prone software? Our error free add-on enables you to focus on your work and boost productivity.

On-time Support

We provide round the clock technical assistance with an assurance of resolving any issues within minimum turnaround time.

Pricing

img

Importer, Exporter & Deleter

*See our Pricing for up to 3 Company Files

$199/- Per Year

Pricing includes coverage for users
  • Services Include:
  • Unlimited Export
  • Unlimited Import
  • Unlimited Delete

img

Accountant Basic

*See our Pricing for up to 10 Company Files.

$499/- Per Year

Pricing includes coverage for users
  • Services Include:
  • Importer,Exporter,Deleter
  • Unlimited Users
  • Unlimited Records
  • Upto 10 companies

img

Accountant Pro

*See our Pricing for up to 20 Company Files.

$899/- Per Year

Pricing includes coverage for users
  • Services Include:
  • Importer, Exporter, Deleter
  • Unlimited Users
  • Unlimited Records
  • Up to 20 companies

img

Accountant Premium

*See our Pricing for up to 50 Company Files.

$1999/- Per Year

Pricing includes coverage for users
  • Services Include:
  • Importer, Exporter, Deleter
  • Unlimited Users
  • Unlimited Records
  • Up to 50 companies

Dancing Numbers: Case Study

Frequently Asked Questions

 
How and What all can I Export in Dancing Numbers?

You need to click "Start" to Export data From QuickBooks Desktop using Dancing Numbers, and In the export process, you need to select the type you want to export, like lists, transactions, etc. After that, apply the filters, select the fields, and then do the export.

You can export a Chart of Accounts, Customers, Items, and all the available transactions from QuickBooks Desktop.


How can I Import in Dancing Numbers?

To use the service, you have to open both the software QuickBooks and Dancing Numbers on your system. To import the data, you have to update the Dancing Numbers file and then map the fields and import it.


How can I Delete in Dancing Numbers?

In the Delete process, select the file, lists, or transactions you want to delete, then apply the filters on the file and then click on the Delete option.


How can I import Credit Card charges into QuickBooks Desktop?

First of all, Click the Import (Start) available on the Home Screen. For selecting the file, click on "select your file," Alternatively, you can also click "Browse file" to browse and choose the desired file. You can also click on the "View sample file" to go to the Dancing Numbers sample file. Then, set up the mapping of the file column related to QuickBooks fields. To review your file data on the preview screen, just click on "next," which shows your file data.


Which file types are supported by Dancing Numbers?

XLS, XLXS, etc., are supported file formats by Dancing Numbers.


What is the pricing range of the Dancing Numbers subscription Plan?

Dancing Numbers offers four varieties of plans. The most popular one is the basic plan and the Accountant basic, the Accountant pro, and Accountant Premium.


How can I contact the customer service of Dancing Numbers if any issue arises after purchasing?

We provide you support through different channels (Email/Chat/Phone) for your issues, doubts, and queries. We are always available to resolve your issues related to Sales, Technical Queries/Issues, and ON boarding questions in real-time. You can even get the benefits of anytime availability of Premium support for all your issues.


How can I Import Price Level List into QuickBooks Desktop through Dancing Numbers?

First, click the import button on the Home Screen. Then click "Select your file" from your system. Next, set up the mapping of the file column related to the QuickBooks field. Dancing Numbers template file does this automatically; you just need to download the Dancing Number Template file.

To review your file data on the preview screen, just click on "next," which shows your file data.


What are some of the features of Dancing Numbers to be used for QuickBooks Desktop?

Dancing Numbers is SaaS-based software that is easy to integrate with any QuickBooks account. With the help of this software, you can import, export, as well as erase lists and transactions from the Company files. Also, you can simplify and automate the process using Dancing Numbers which will help in saving time and increasing efficiency and productivity. Just fill in the data in the relevant fields and apply the appropriate features and it’s done.

Furthermore, using Dancing Numbers saves a lot of your time and money which you can otherwise invest in the growth and expansion of your business. It is free from any human errors, works automatically, and has a brilliant user-friendly interface and a lot more.


Why should do you change the Employee status instead of deleting them on QuickBooks?

If you are unable to see the option to terminate an employee on your list of active employees on the company payroll, this mostly implies that they have some history. Thus, if you change the employee status instead of deleting it on QuickBooks, the profile and pay records remain in your accounting database without any data loss in your tax payments.


Is it possible to use the Direct Connect option to sync bank transactions and other such details between Bank of America and QuickBooks?

Yes, absolutely. You can use the Direct Connect Option by enrolling for the Direct Connect service which will allow you access to the small business online banking option at bankofamerica.com. This feature allows you to share bills, payments, information, and much more.


Why should do you change the Employee status instead of deleting them on QuickBooks?

If you are unable to see the option to terminate an employee on your list of active employees on the company payroll, this mostly implies that they have some history. Thus, if you change the employee status instead of deleting it on QuickBooks, the profile and pay records remain in your accounting database without any data loss in your tax payments.


What are the various kinds of accounts you could access in QuickBooks?

QuickBooks allows you to access almost all types of accounts, including but not limited to savings account, checking account, credit card accounts, and money market accounts.

Get Support

Bulk import, export, and deletion can be performed with simply one-click. A simplified process ensures that you will be able to focus on the core work.

Worried about losing time with an error prone software? Our error free add-on enables you to focus on your work and boost productivity.

Call Now+1-800-596-0806
Top