How do I record lost products?


E

Eric Cartman

I sometimes use USPS to ship products from time to time and they sometimes
get lost in the mail and I have to resend the product again at my expense. I
am able to do a credit memo for the product and this will put it back into
inventory but how do I get it out of inventory and let QuickBooks know that
I have to eat the cost for reshipping the product. I am using QuickBooks Pro
2004.

Thanks
 
Ad

Advertisements

A

Allan Martin

Eric Cartman said:
I sometimes use USPS to ship products from time to time and they sometimes
get lost in the mail and I have to resend the product again at my expense. I
am able to do a credit memo for the product and this will put it back into
inventory but how do I get it out of inventory and let QuickBooks know that
I have to eat the cost for reshipping the product.
Why issue a credit note adding the products back into inventory to begin
with? If you simply enter a duplicate invoice with zero charge for the items
when you resend the items to your customer this will record the additional
cost.

If at a latter date, UPS returns the goods to you, then make an inventory
adjustment for the items returned.



I am using QuickBooks Pro
 
M

Mike Block, C.P.A.

Eric Cartman said:
I sometimes use USPS to ship products from time to time and they sometimes
get lost in the mail and I have to resend the product again at my expense. I
am able to do a credit memo for the product and this will put it back into
inventory but how do I get it out of inventory and let QuickBooks know that
I have to eat the cost for reshipping the product. I am using QuickBooks Pro
2004.

Thanks
Use the Inventory Adjustment Option under Vendor Navigator and
decrease the Inventory and select the Adjustment Account say Lost in
Transit under Expenses.

Mike Block, C.P.A
Intuit paid me to make QuickBooks better!
http://www.blocktax.com/
http://www.quickbooks-add-ons.com/
 
S

S.M. Serba

A previous poster said that then the OP resends the product, replacing the
one lost in the mail, it should be sold for zero dollars and cents, thus
reflecting the fact it is being replaced at no cost to the customer. This
will reduce inventory, and correctly show no revenue earned in the sale of
the product, but original costs will be reflected in COGS.

IF the item lost in the mail is returned by the post office (all Canadians
and Americans can say "yeah, right"), THEN adjust the Inventory, using "item
lost in transit and returned by post office" in the description.
 
Ad

Advertisements

A

Allan Martin

S.M. Serba said:
A previous poster said that then the OP resends the product, replacing the
one lost in the mail, it should be sold for zero dollars and cents, thus
reflecting the fact it is being replaced at no cost to the customer. This
will reduce inventory, and correctly show no revenue earned in the sale of
the product, but original costs will be reflected in COGS.
Actually the original cost was already correctly recorded when the initial
invoice was posted. The second zero price invoice will record the cost of
the items in the second shipment. The cost associated with the second
shipment need not be the same as the first since additional item purchases
at different rates could have been made between the time interval of the two
shipments to the customer.

This method also assumes that the amounts are not material and charging the
COGS account is acceptable. Needless to say an adjusting journal entry could
also be made to reclassify this expense out of COGS to some type of items
lost account.

Both methods will work just fine, however I believe for the average QB user
generating a second zero price invoice is the simplest method.
 
Ad

Advertisements


Ask a Question

Want to reply to this thread or ask your own question?

You'll need to choose a username for the site, which only take a couple of moments. After that, you can post your question and our members will help you out.

Ask a Question

Top