What is an inventory adjustment in QuickBooks Online

What the adjustment form asks for

On count day, you end up with a counted total for each item. For some items it differs from the quantity in your books.

Intuit's article on adjusting inventory quantity says the form takes an adjustment date, an inventory adjustment account, a new quantity or a change in quantity for each item, and a memo. It says saving the adjustment automatically records adjustments to the Inventory Asset and Cost of Goods Sold accounts. The entry on the inventory asset account covers that side.

Intuit describes the form for Plus, Advanced and Intuit Enterprise Suite. Afterwards you find the entry with Advanced search, by choosing Inventory Quantity Adjustment in the All Transactions list. The guide to adjusting inventory quantity is the walkthrough, and the guide to recording inventory shrinkage covers a loss.

What the entry leaves out on count day

Plus and Advanced keep one quantity on hand per item, and the inventory adjustment form takes one number per item. Say you count one item at location A-04 and at location B-09, both in one warehouse. You find 12 and 8. The form takes one number for that item, 20.

So the entry cannot say which location a difference came from. That is why a count by location is summed for each item first. The limitations guide covers the hand procedure.

Where Count touches the adjustment

InventoryWare Count connects to QuickBooks Online. When Count sends approved lines, it creates one Inventory Quantity Adjustment, with one line for each item that is still an approved discrepancy at that point and linked to a QuickBooks Online item. Each line carries the item's counted total as its new quantity.

A sync refreshes the QuickBooks quantity Count holds for each linked item. If a later sync makes an item's counted total match the QuickBooks quantity, that line drops out of the send. A line that is still a discrepancy keeps its approval.

The post date defaults to the count plan's completed date, and you can change it before sending. You choose the inventory adjustment account from the company's Cost of Goods Sold and Expense accounts in QuickBooks Online. Count writes the memo: the count plan's name, its completed date and the counters' names, the first three and then how many more.

Nothing posts while the count is running, and nothing posts until a manager approves the discrepancy; only approved lines post; nothing nobody counted is zeroed automatically; posting from a partial count is not available.