Help/POS and Inventory/Stock, invoices and your books
Stock, invoices and your books
Stock you sell on an invoice comes off the shelf too. And every stock change reaches your accounting by itself: buying stock is an asset, selling it is a cost.
Screenshots use a fictional business and figures. Select an image to view it full size.
Sell stock on an invoice
Make an invoice as usual. On a line, start typing an item’s name, SKU or barcode. Items under From your stock show their SKU and how many are free.
Pick one. Its price fills in, and you can change it.
Picking rose stems from stock for an event order. Under the lines, choose Stock comes from: the location the goods leave from.
Held, then taken
What happens to the stock follows the invoice:
- Draft, or waiting for approval: nothing is held.
- Issued, not fully paid: the stock is held for this customer. It is still on hand but shows as Committed, so it is not free to sell at the till.
- Paid in full: the stock is taken for good, and its cost reaches your P&L.
- Cancelled or deleted: the stock is let go.
- A payment undone: the stock goes back on the shelf.
How stock reaches your books
You do not post anything by hand. Each stock change does this:
- Stock in: your stock goes up on the balance sheet at what you paid, and the money leaves your bank or cash. The GST counts towards your claim. Your P&L does not change.
- Starting stock: added to your balance sheet as stock you already owned. Your P&L does not change.
- A sale at the till: the sale is income in your P&L, and the stock’s cost moves from the balance sheet into cost of sales.
- An invoice: the sale counts as income on the day the invoice is issued, like any invoice. The stock’s cost moves into cost of sales once it is paid in full.
- A write-off, or stock missing at a stock take: the cost moves into cost of sales. Stock found again goes back into stock.
- A return put back into stock: the stock and its cost come back, and the refund comes off your income.
- Moving stock between locations: nothing changes in your books.
Till sales are added to your P&L as one line per day, and so is the day’s cost of sales, so a busy day does not fill your books with rows. Your balance sheet shows the value of your stock on a Stock line.
Questions
Why did my profit not go down when I bought stock?
Stock you have not sold is still yours. It is an asset on your balance sheet until it sells, and then its cost reaches your P&L.
At what cost does a sale come off my stock?
At the item’s average cost: what you paid for everything on hand, blended together.
Does GST on stock I buy count?
Yes. If you are GST-registered, the GST on a stock in counts as input tax on your GST return, just like a receipt.