There are many processes involved in setting up landed costs in QuickBooks Enterprise, which guarantees precise monitoring and distribution of import-related charges. In addition to the initial cost of purchase, landed costs also include other charges, such as shipping, handling fees, taxes, and customs duties. Businesses may learn more about the actual cost of items supplied and make more profitable and well-informed pricing choices by correctly allocating these expenses. Here is a comprehensive tutorial on configuring landing expenses in QuickBooks Enterprise:
Step 1: Enable Landed Cost Feature
To monitor and manage import-related costs efficiently, the first step is to enable QuickBooks Enterprise’s landed cost function. Landed costs include a range of charges that go beyond the purchase price, such as handling fees, taxes, customs duties, and shipping. Here’s how to activate this feature in detail:
After gaining administrator access to your QuickBooks Enterprise account, go to the “Edit” menu and choose “Preferences.” Select “Items & Inventory” or “Items & Inventory > Company Preferences” from the list of preferences. This is where you may turn on the landed cost functionality.
Make sure that “Inventory and purchase orders are active” is ticked in the checkbox. This is an essential step since QuickBooks Enterprise’s purchase order processing and inventory management are directly related to landing expenses.
Next, choose “Advanced Inventory Settings” and make sure that the “Enable landed expenses” box is checked. By doing this, you may enable the feature that allows you to include other costs that you spent throughout the importing process in your inventory costing.
Remember to click “OK” or “Save” to save your modifications once you’ve activated the landed cost function. This guarantees that the configurations are implemented and preserved inside the QuickBooks Enterprise option.
Enabling landed costs in QuickBooks Enterprise can give businesses a complete picture of the cost of items sold, making financial reporting and decision-making more precise. By including these extra charges in your inventory costing, you can gain insights into the real cost of imported items, which is crucial for pricing plans, profitability analysis, and supplier negotiations.
Step 2: Make Landed Cost Items
Creating landed cost items in QuickBooks Enterprise is necessary to precisely monitor and allocate different costs related to importing goods. These fees include insurance, freight charges, customs tariffs, and other associated expenditures. Here’s how to efficiently produce landed cost items:
To get to the “Item List,” go to the “Lists” menu and choose “Item List.” You may examine and control every item in your inventory from this location.
To add a new landed cost item, click the “Item” button or hit Ctrl+N to start the item creation process.
Choose the relevant item category based on the kind of landed cost. “Other Charge,” “Service,” and “Non-inventory Part” are some examples of options based on how you wish to classify the cost.
Include the name, description, and related expense account where the cost will be recorded for the landing cost item, along with any other pertinent information. Make sure the expenditure account you choose, such as “Freight expenditure” or “Customs Duty,” appropriately matches the kind of landing cost.
After entering all the required data, click “OK” or “Save & Close” to save the item.
Repeat the previous procedures as necessary to construct additional landed cost items for other charges incurred throughout the importing process.
With QuickBooks Enterprise, you can create landed cost items to create an organized system for keeping track of different import-related costs. These entries function as separate entries in your accounting records, facilitating precise reporting and allocation of landing expenses related to inventory goods.
Step 3: Set Up Landed Cost Vendor
In QuickBooks Enterprise, you may assign certain suppliers to handle costs associated with imports by setting up a landed cost vendor. This categorization makes the monitoring and allocation of landing expenses related to purchases made from certain suppliers easier. To set up a landed cost vendor, follow these steps:
To access the “Vendor Center,” go to the “Vendor” menu and choose “Vendor Center.” This primary portal provides a comprehensive view of every vendor in your QuickBooks Enterprise account.
To add a new vendor, click the “New Vendor” button or start the vendor creation process by pressing Ctrl+N.
Enter the vendor’s information, such as name, address, phone number, and any other pertinent facts.
To assign the vendor responsibility for managing landed cost costs, check the box labelled “This vendor is a landed cost vendor.”
To save the vendor record, choose “Save” or “OK.” By doing this step, you can make sure that the vendor is assigned to and correctly configured inside QuickBooks Enterprise to handle landed cost charges.
To set up additional landed cost vendors for various suppliers engaged in the import of products, repeat the previous procedures as necessary.
Establishing landed cost suppliers in QuickBooks Enterprise helps you manage import-related costs by creating a transparent chain of responsibility. This classification makes it easier to manage and allocate landing costs accurately, guaranteeing that the related expenditures are correctly documented and assigned to the appropriate suppliers.
Step 4: Create a Purchase Order with Landed Costs
In QuickBooks Enterprise, you may precisely capture the whole cost of purchasing inventory products, including extra charges paid throughout the importation process, by creating purchase orders with landed costs. To construct a purchase order with landed charges, follow these steps:
By going to the “Vendors” menu and choosing “Create Purchase Orders,” you may use the “Create Purchase Orders” option. This launches a new purchase order form where you can enter the purchase’s specifications.
From the list of vendors in your QuickBooks Enterprise account, choose the vendor from whom you are buying products.
Include the things you want to buy with the purchase order, together with the costs and quantities for each.
Put distinct line items for the landed cost items you already generated on the purchase order. This enables you to budget for supplementary costs like insurance, freight, and customs fees.
Based on the actual costs incurred, assign costs to each landed cost item. Depending on your option, you may either manually input the amounts or utilize established allocation techniques.
After entering the required data, click “Save & Close” to save the purchase order. The purchase order is completed with this step, which also logs the information into your QuickBooks Enterprise account.
Entering purchase orders with landed costs into QuickBooks Enterprise ensures that all import-related costs are accurately recorded and included in your inventory costing. This all-inclusive method allows you to precisely determine the total cost of purchasing inventory goods, which improves financial analysis and decision-making.
Step 5: Receive Inventory with Landed Costs
One of the most critical steps in the procurement process is receiving inventory with landed costs in QuickBooks Enterprise. This allows you to precisely record and assign expenses related to importing products. How to get the inventory with landing charges is as follows:
By going to the “Vendors” menu and choosing “Receive Inventory,” you may use the “Receive Inventory” option. This creates a new inventory receipt form that allows you to enter information about the things you have received.
From the list of open purchase orders in your QuickBooks Enterprise account, choose the one that corresponds to the inventory goods you received.
Make sure the landed cost items appear on the receipt as distinct line items when entering the quantity of the products received. This enables you to budget for extra costs like freight, customs fees, and insurance related to the things you acquired.
Determine which goods will get the landing costs according to your desired allocation mechanism (e.g., by amount, weight, or value). You have two options for entering the amounts: utilize QuickBooks Enterprise’s established allocation techniques or input them manually.
Click “Save & Close” to save the inventory receipt once you’ve input all the required data. This completes the inventory receipt process and logs all the information—including the landed costs—into your QuickBooks Enterprise account.
Receiving inventory with landed costs in QuickBooks Enterprise ensures that all costs spent throughout the importing process are precisely documented and assigned to the appropriate inventory items. This all-inclusive strategy allows you to manage precise inventory costing and make well-informed choices about pricing, profitability, and supplier relationships.
Step 6: Examine Landed Cost Reports
QuickBooks Enterprise reports offer insightful information about the overall cost of purchasing inventory items, together with all related expenses incurred during the importation procedure. The following is an excellent way to examine landed cost reports:
By going to the “Reports” menu and choosing “Inventory Reports” or “Custom Reports,” you can see the several inventory reports that QuickBooks Enterprise offers. These reports provide statistics on inventories, including landing costs, from several angles.
Select an appropriate landed cost report from the list of possibilities, such as “Inventory Valuation Detail,” “Landed Cost by Vendor,” or “Item Profitability.” Depending on your unique analytical needs and the insights you want to get, choosing the right report is essential.
You can adjust the chosen report to fit your needs and tastes. For example, you may change factors like the reporting period, suppliers, inventory items, and cost allocation techniques to concentrate on certain landed cost analysis features.
Examine the information in the landed cost report to learn more about the overall cost of the products sold, which includes all related expenses, including insurance, freight, and customs fees. Pay close attention to specifics like vendor contributions, landing cost numbers, and inventory value data.
Examine the data on landing costs to find trends, patterns, and areas that need improvement. Using the information from the report, find ways to streamline importation procedures, save expenses, and raise revenue.
Make wise choices based on the information in the landing cost report. Use the data to improve inventory management procedures, negotiate supplier contracts, modify pricing methods, and raise overall company performance.
You may see the actual cost of purchasing inventory products by looking at landed cost reports in QuickBooks Enterprise. This information can help you make data-driven choices and improve your operations for increased productivity and profitability. These reports are valuable resources for efficiently tracking and controlling landing expenses, which will help you keep a competitive advantage in the fast-paced business world of today.
These procedures will help you set up landing costs in QuickBooks Enterprise and keep proper track of the charges related to importing products. Businesses may maximize their operations for increased efficiency and profitability and make well-informed choices thanks to these capabilities.
