How To Assign Employee Salaries to COGS in QuickBooks: A Step-by-Step Guide

As a business owner, it's essential to accurately track your expenses and revenues to make informed financial decisions. One way to do this is by assigning employee salaries to the Cost of Goods Sold (COGS) account in QuickBooks. In this article, we'll walk you through the steps on how to assign all employee salaries to COGS accounts using QBO.

Before we begin, please note that it's recommended to consult with an accounting consultant to ensure that this method is the best fit for your business.

Step 1: Access Payroll Reports

To access different payroll reports, go to the Reports menu and select the Employees & Payroll tab. From here, you can view various payroll reports, including employee salaries.

Step 2: Edit Payroll Items

Right-click on the Salary Item and click Edit. In the account drop-down arrow, choose COGS as the account. Let's change the Salary Item to COGS by going to the Payroll Item List.

Step 3: Create a Journal Entry

To post your employee salary into COGS, you can create a journal entry. Under the Other column, select Journal Entry. Fill out the fields to create your journal entry and give the total underlying costs on your Profit & Loss reports.

What is Cost of Goods Sold (COGS)?

Cost of Goods Sold tracks all of the costs associated with the items you sell, which allows you to calculate gross profits accurately. It's essential to track these costs to ensure that you're making accurate financial decisions for your business.

Assigning Employee Salaries to COGS in QuickBooks Desktop

If you're using QuickBooks Desktop, you can assign employee salaries to COGS by following these steps:

1. Click on the Payroll Item List.

2. Right-click on the Salary Item and click Edit.

3. Choose COGS as the account in the account drop-down arrow.

Additional Tips and Resources

* For more detailed information about payroll in your QuickBooks Online account, check out our article: Get started with Payroll.

* You can also use this article to learn how to print a journal entry report.

* If you're looking for assistance on what account to use, consider consulting with an accountant or using Intuit's Find-A-ProAdvisor site to search for certified professionals in your area.

By following these steps and tips, you can accurately assign employee salaries to COGS accounts in QuickBooks. Remember to consult with an accounting consultant if you have any questions or need further assistance. With QuickBooks, you're not limited by the features; you're only limited by your imagination!

Auto dealer cogs accounts qbo