How Can I Track the Profitability of a Purchase Order in Quickbooks?
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QuickBooks allows you to set up purchase orders as jobs. A report of profitability by job can be run after the PO has been invoiced and the supplier purchase order has been converted to a bill or paid.
To set up a job, go to "customer" and then "customer center." Highlight the customer for whom this PO is being written. At the top of the screen, click "new customer and job," and then "add job." It will be added under the heading of the Customer you have chosen.
I like to label the jobs as "PO XXXX" with the PO number. It makes it easy to track throughout your system. To make sure that QuickBooks ties the invoice and the cost of goods sold together, select the "customer:job" option from the dropdown box for each item in the supplier purchase Order.
Knowing the profitability of an order can be very important to you. Is that a reorder you want to pursue? Should I price this differently next time I sell this item? Wow, I like this item ... look at the profit!
Setting up jobs also allows you to see the orders you have done for a customer at a quick glance of the customer center.
Harriet Gatter, owner of Accounting Support LLC, was an ad specialty distributor for 23 years and an adjunct professor of accounting at Neumann University. She sold her ad specialty business in 2012, became certified as a QuickBooks ProAdvisor, and now works exclusively with ad specialty distributors nationwide on their QuickBooks and accounting needs. Please email accounting questions you would like considered for the column to HGatter@AccountingSupportLLC.com with the subject line of "Ask the Accountant."