QuickBooks Online (QBO) offers a robust feature called the Products and Services List that allows businesses to manage their inventory, track sales, and generate accurate financial reports. This feature is essential for businesses that sell both goods and services, enabling them to categorize their offerings and streamline their accounting processes.
What is on a Product and Service List in QuickBooks Online?
The Products and Services List in QuickBooks Online includes all the items that a business sells, purchases, or uses to generate income. This list is crucial for managing inventory, tracking sales, and creating invoices. The list contains:
Product Name: The name of the product or service.
SKU/Item Number: The stock-keeping unit or identification number for tracking.
Type: The classification of the item (e.g., inventory, non-inventory, service, or bundle).
Sales Information: Description, price, and income account associated with the sale of the item.
Purchase Information: Cost and expense account associated with purchasing the item.
Quantity on Hand: For inventory items, the number of units available.
Reorder Point: A specified level at which inventory should be reordered.
Tax Status: Indicates whether the item is taxable or non-taxable.
How to Categorize Products and Services in QuickBooks Online?
To categorize products and services in QuickBooks Online, you need to follow these steps:
Go to the Products and Services Menu:
Navigate to Sales and select Products and Services.
Select New Product or Service:
Click on the New button to add a new product or service.
Choose the type (inventory, non-inventory, service, or bundle).
Enter Product or Service Details:
Fill in the fields like name, SKU, type, sales price, cost, and the account to track sales or expenses.
Assign Categories:
Use the Category dropdown to assign the product or service to a specific category (e.g., office supplies, professional services).
Save and Close:
Click Save and Close to finalize the entry.
Where Are Products and Services in QuickBooks?
To access the Products and Services List in QuickBooks Online:
Go to the Sales Menu:
From the left-hand navigation panel, click on Sales.
Select Products and Services:
Under the Sales menu, click on Products and Services. This will display a list of all the products and services you have added.
What is a Product in QuickBooks Online?
A product in QuickBooks Online refers to any physical item that a business sells or purchases. Products can be categorized into:
Inventory: Items that a business buys and sells, tracked in real-time for stock levels and cost of goods sold (COGS).
Non-Inventory: Items that are bought and sold but are not tracked in inventory, such as office supplies.
Service: Intangible activities provided to customers, such as consulting or repair services.
Bundle: A group of products or services sold together as a package.
What is the Purpose of the Products and Services List in QuickBooks Online?
The Products and Services List serves several important purposes in QuickBooks Online:
Inventory Management: Tracks the quantity and value of inventory items in real-time, helping businesses maintain optimal stock levels.
Sales Tracking: Provides detailed information on which products or services are being sold, their pricing, and associated income accounts.
Expense Management: Helps track the cost of products and services purchased for business use.
Financial Reporting: Allows for accurate financial reports, such as profit and loss statements, balance sheets, and inventory valuation reports.
Invoice Creation: Streamlines the process of creating invoices and sales receipts with accurate product and service information.
Setting Up Products and Services in QuickBooks Online
To set up products and services in QuickBooks Online, follow these steps:
Navigate to Sales:
Go to the Sales menu and select Products and Services.
Add New Product or Service:
Click on the New button.
Select Type:
Choose the type of item you want to set up: inventory, non-inventory, service, or bundle.
Enter Details:
Provide the required details such as name, SKU, sales description, purchase description, price, and cost.
Set Inventory Levels (for Inventory Items):
Enter the quantity on hand and the reorder point to manage stock levels.
Assign Accounts:
Choose the appropriate income, expense, or COGS accounts to track sales and purchases.
Save:
Click Save and Close to add the item to your Products and Services list.
QuickBooks Products and Services Categories
QuickBooks Online uses the following categories for products and services:
Inventory: Items tracked for inventory management and COGS.
Non-Inventory: Items not tracked as inventory but used for sales and purchases.
Service: Activities or benefits provided to customers (e.g., consulting, repair).
Bundle: A combination of products and/or services sold as a package.
Where Can You Go in QuickBooks Online to Import a List of Products and Services?
To import a list of products and services into QuickBooks Online:
Go to the Products and Services Menu:
Navigate to Sales > Products and Services.
Click on the Gear Icon:
Select the Import button located at the top right.
Upload the File:
Follow the prompts to upload your CSV or Excel file containing the product and service data.
Map Your Data:
Map the data fields from your file to the appropriate QuickBooks fields.
Review and Import:
Review the imported data and click Import to finalize.
What Are the Four Types of Products and Services QuickBooks Online Uses?
QuickBooks Online categorizes products and services into four types:
Inventory: Physical goods that are bought and sold and tracked for inventory.
Non-Inventory: Items that are not tracked for inventory but are still bought and sold.
Service: Intangible offerings like consulting or repair services.
Bundle: A group of products or services sold together as a single unit.
Of the QBO Products and Services Types, Which is Considered Inventory?
Among the QuickBooks Online product and service types, Inventory is the type that is considered an inventory item. Inventory items are goods that a business buys and sells while tracking quantities and costs in real-time.
QuickBooks Online Allows You to Inactivate Items from the Default
QuickBooks Online allows you to inactivate products and services that are no longer in use. This action removes the item from active lists but retains it in historical records for reporting purposes.
To Inactivate an Item:
Go to Products and Services:
Navigate to Sales > Products and Services.
Find the Item:
Locate the item you want to inactivate.
Select Action Dropdown:
Click the Action dropdown next to the item and select Make Inactive.
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Final Thoughts
The Products and Services List in QuickBooks Online is a powerful tool for businesses to manage inventory, track sales, and optimize financial reporting. By categorizing products and services correctly and understanding the types available, businesses can ensure accurate accounting and streamlined operations.
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