QB Issue Resolution:
Cost of Goods Sold (COGS) is an account used to track your costs of materials related to the sales you provide. It captures the COGS that are associated with your inventory items in the Profit and Loss report. Then, the Gross Profit is the difference between the Total Income and Cost of Goods Sold. You can check out the first screenshot below for your reference.
Here are uses of the detail types of COGS:
- Cost of labour – COS: track the cost of paying employees to produce products or supply services, such as employment costs.
- Equipment rental – COS: renting equipment costs.
- Other costs of service – COS: services you provide that don’t fall into another Cost of Goods Sold type.
- Shipping, freight and delivery – COS: track the cost of shipping products to customers or distributors.
- Supplies and materials – COS: manage the cost of raw goods and parts used or consumed.
The second screenshot below serves as your visual guide.
You’ll need to customize the P&L report if your business operates on a cash basis. Then, change the accounting method to Accrual to ensure you’re seeing the correct Gross Profit. To learn more about the effects of inventory tracking on the report, see this article: Impacts on Profit & Loss Report.
Resolution for Issue 'Which account in P&L is used to capture cost of goods sold for inventory items? I have problem understanding the detail type of Cost of goods sold.' available: Yes (Solved).
Source: Intuit Community forum.
Which account in P&L is used to capture cost of goods sold for inventory items? I have problem understanding the detail type of Cost of goods sold.: this issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If it is a complex issue or you are unable to solve the issue, you may contact us by clicking here or by using other support options.Support for inventory items
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