Kingston, May 28, 2022: Negative Quantity on Hand (QOH) or Negative Inventory in a QuickBooks data file happens when there are not enough items in stock. This could be because entering sales transactions were entered before entering purchase transactions.
Negative inventory is a situation where the quantity on hand for a certain inventory item falls below zero. QuickBooks maintains the cost of each inventory item based on the average of all purchases. When the quantity is brought back above zero, QuickBooks makes entries trying to correct the cost of those already sold and items for which it had no average cost at the time.
Negative inventory has shown itself to be a very common problem in the manufacturing industry, and some companies even use it as an actual business practice. By embracing negative stock, could land a business in deeper waters as it results in making unnecessary decisions, such as ordering more materials or starting production, due to faulty information.
Negative Quantity on Hand shows up on the balance sheet but will also mainly show on the Inventory Valuation Detail report with negative numbers in the Quantity on Hand (QOH) column. This could also result in data becoming damaged to the point that the file must be rebuilt entirely, the Cash-basis balance sheet becomes out of balance, vendor reporting is incorrect and Cost of Goods Sold (COGS) and profit amounts are incorrect.
In addition, since capital consists of current assets, minus current liabilities, if went down on the income statement, the working capital will go up. Negative inventory also leads to mistakes in Accounts Payable, bills for inventory purchases could show up on income and expense reports, and incorrect inventory amount on the Balance Sheet.
E-Tech offers a repair service to fix all instances of negative inventory in the file. The service will analyze the source data file to identify the items and dates the quantity on hand (QOH) went negative and then fix all occurrences of negative inventory.
The repaired file will not have negative inventory and will verify correctly in QuickBooks. There may be a change to the COGS and Inventory Asset account balances after the repair. There will also be a change to the Opening Balance Equity account that will be used to add the inventory adjustments.
Visit https://quickbooksrecovery.co.uk/quickbooks-file-data-services/quickbooks-negative-inventory-repair/ for more information.
About E-Tech
E-Tech is the leading service provider of QuickBooks File Repair, Data Recovery, QuickBooks Conversion and QuickBooks SDK programming in the UK and Ireland. In our 20 years plus of experience with Intuit QuickBooks, we have assisted over a thousand satisfied customers with their requirements.
We offer a range of services for existing QuickBooks users and provide comprehensive solutions for small businesses. Additionally, our expertise covers the US, UK, Canadian, Australian (Reckon Accounts), and New Zealand versions of QuickBooks (PC and Mac platforms).
For media inquiries regarding E-Tech, individuals are encouraged to contact Media Relations Director, Melanie Ann via email at Melanie@e-tech.ca