In this article you will learn about Enhanced Inventory Receiving or EIR in QuickBooks Desktop. To know more, contact QuickBooks Support.
Enhanced Inventory Receiving or EIR in QuickBooks Desktop Enterprise lets you separate Item Receipts from Bills. It also lets you create a new process for paying and receiving Items.
Please note: Once turned on, EIR cannot be turned off. Before following the steps in this article, create a backup of your company file. Using a copy of your file, run a test to weigh if it works with your business process.Consider condensing your file if your company file is too big.
Firstly, you need to answer the following questions. EIR might be beneficial for your business if your answer to any of these is "Yes".
Do you receive one bill that covers multiple item receipts?
Before you receive an item, you pay for them and don't want your inventory quantities to increase?
For one item receipt, do you receive multiple bills?
From accounts payable (enter and pay bills), do you want to separate the receiving department (item receipts)?
What are the effects ofturning on EIR?
Inventory Items and Bills created from Item Receipts in bills that no longer replace Item Receipts.
Unless you receive a Bill for an open Item Receipt,item receipts no longer affect Accounts Payable.
QuickBooks will change the item cost on the Item Receipt, even if the Item Receipt is in a closed period if you receive a Bill that has different costs compared with the connected Item Receipt.
Every time a new Item Receipt is entered,QuickBooks Desktop recalculates inventory average cost. These Item Receiptssometimes result to a small rounding error to the average cost or changes the order of inventory transactions within each day.
Increasing the number of transactionsan Item Receipt is created for every Bill in your company file which includes items.
A third-party application which is affected by inventory may not work as it is expected to work.
Restrictions to using EIR
1. In Item Receipts or Bills,you cannot enter negative items.
2. You cannot enter expenses On an Item Receipt,you cannot enter expenses.
You must receive them with an Item Receipt to close the PO if you create a Purchase Order for non-inventory Items.
On Item Receipts,you can no longer mark items as "Billable”.
The Accounting that goes behind EIR
When you turn on EIR,a liability account created by QuickBooks Desktop namingInventory Offset Account. The amount for these transactions is cleared from the Offset account when Bills and Item Receipts are entered.
When you enter an Item Receipt, the following Journal Entry is created in QuickBooks Desktop:
When you enter a Bill,the following Journal Entry is created by QuickBooks Desktop :
Common reports may not look the way they used to, because of the way these transactions are created in QuickBooks Desktop after you turn on EIR.
How to enable EIR?
- Choose Preferences from the Edit menuand then select Items & Inventory.
- In the Company Preferences tab, click on Enable under "Enhanced Inventory Receiving" section.
- Review the warning message that shows and then select Continue, then click on OK.
- To back up your company file, you will be prompted.It may take a while to complete this process depending on the size of your company file.
- A summary of changes that happened during this process will be provided by QuickBooks Desktop once finished.
- For receiving and paying for items there is a new process.
To receive and pay inventory when EIR is off, there are two methods.
Single Transaction: You can enter a bill that increases your inventory on hand also.
Two Transactions: To increase your inventory, enter an item receipt and then record a bill against the item receipt.
You have to record two transactions after turning EIR on in any order:
To increase inventory on hand record an Item Receipt.
To know and learn more about Enhanced Inventory Receiving or EIR in QuickBooks Desktop, call us on our QuickBooks support number. You can also write to us at support@qbooks247.com . For more information visit - www.qbooks247.com.
