USA How to clear inventory offset account in QBE

[smallbushelp]

I have a client who issued a PO to a vendor and received the items but the vendor never billed them for the stuff. This was eight months ago. The client doesn't want to rock the boat by asking for a bill.

They use QuickBooks Enterprise with advanced inventory so the item receipt debited inventory and credited the inventory offset account. Now to clear the offset account, since there will be no bill, I have to debit it but I'm not really sure what account to credit. Would this be considered a gain on receipt of inventory and posted to an other income account? Or is it appropriate to credit the COGS account?

I would appreciate some thoughts from other CPAs.

 

[AGH the CPA]

Not for nothing but I would ask for a bill if I were the client. They have effectively stolen from the vendor. That said, I would offset to a liability account since chances are good the vendor will figure out it hasnt been paid at some point.