In order for QuickBooks Online to properly track the Megaventory Production/Manufacturing process, a few new accounts will be automatically created in the QuickBooks Chart of Accounts upon the activation of the Megaventory - Quickbooks Online integration. The default account names are:
- Asset Account Name for Work in Process (WIP) Allocated Components
- Expense Account Name for Production Order Labor Costs
- Expense Account Name for Production Order Overhead Costs
- Expense Account Name for Production Order Services Costs
(These accounts can be later renamed in the Account Integrations section of Megaventory)
A Production Order issued and processed in Megaventory will result in the respective accounts in QuickBooks Online being updated accordingly.
The following table indicates which of the QuickBooks Online accounts is credited or debited in each stage of the Work Order (Component Allocation and Finished Good Receiving in Megaventory). For the credit/debit operations a bill is created for a virtual supplier in QuickBooks Online.
The example includes a simple Bill Of Materials (BOM) that includes a Buy From Supplier (Inventory item) product with a cost of $40 and a service item with a cost of $10. The Finished good is later sold and the service is purchased and paid to the manufacturer.
The last step "Purchase of Service item" is needed in case the production/manufacturing process is being outsourced to a 3rd party manufacturer (not performed in-house).