Elements of a Good Item List or Inventory Part List
QuickBooks Inventory items consist of the following: Item name or number, type of item (whether it is an inventory item, non-inventory item, service or labor item, etc.), item description, item cost and account, and item sales price and account.
Item Name or Number
One very important aspect of your inventory part list is the item name. If you use a number, be sure that it coincides with something else about the item. A good rule of thumb in naming inventory items is to use the same name or number that your supplier uses. Another useful tip in naming your inventory items is to use an alpha or numeric system. Most accounting software packages will list inventory items in numerical and then alphabetical order. Once your inventory list exceeds 100 items, having an alpha or numeric naming system will certainly become beneficial.
Not all items your business sells will need to be tracked in inventory. For example, labor would be considered a service item. If you have different labor charges for different types of service, be sure to set up an item for each type. Non-inventory type items are also useful for invoicing if it is a seldom used item.
Tip: Always include a miscellaneous item, that way you can invoice for miscellaneous parts without having to set up a new item and clutter your item list. If you sell a group of individual items together, be sure to set up a group item that includes each of the individual items. This will allow you to use a group item that will automatically adjust inventory quantities for each of the individual items within the group.
Item descriptions are very important. The description is what will be listed on the invoice or on the purchase order.
Tip: For inventory items, be sure to include the supplier’s part number in the item description. This will help to avoid any confusion with your suppliers. Group items will also need a good description, especially if you do not want all the individual items printed out on an invoice.