On 10/6/22 8:35 PM, Jared Squires wrote:
I'm trying to find a way to implement the Cost of Goods Sold in the Income
Statement. Right now I have it as it's own Expense Top Level Account but
it messes up my Income Statement for my actual Gross Profit.
How does it 'mess up' your statement for Gross Profit?
I tried to
make CoGS as an "Income" but then when I enter bills from vendors, I can't
label the line item on the bill.
COGS sold is definitely NOT income. I'm not sure why you'd even attempt
such an approach.
The basic usual transactions would look something like this:
When Purchasing Inventory for re-sale:
Dr. Assets:Inventory
Cr. Assets:Cash
When Selling the inventory
Dr. Assets:Cash
Dr. Expenses:Cost of Goods Sold
Cr. Income:Sales
Cr. Assets:Inventory
You can split that Selling transaction into two, one for just the sale,
and the other for adjusting Inventory to COGS.
My current tree structure is like this:
Assets
-> Current Assets
->->General Checking
->Furniture and Equipment
->A/R
Income
->Fees and Revenue
CoGS
->Government Fees
->Search Fees
Expenses
Liabilities
Equity
I did a bunch of searches but didn't see anything since about 2015, and
nothing discussing how to get it to appear correctly on the Income
Statement.
What do you mean by 'appear correctly'?
It is an expense of doing business. It belongs as a sub-account of Expenses.
I suppose you can treat it as a top-level account, but that might not be
what you are looking for.
I've seen P&Ls (Income Statements) that break it out before 'other'
Expenses to show a 'net revenue' position after COGS, but that is just
presentational. It is still an Expense.
If this is what you are looking for, you have two options:
1. Export the Income Statement Report to a Spreadsheet app and
manipulate from there.
2. Create a custom Income Statement Report that places COGS wherever you
want it with whatever additional subtotals you would like.
Regards,
Adrien
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