Recording Damaged or Stolen Inventory Items

Modified on Fri, 31 Mar 2017 at 01:44 PM

To write off damaged/lost/stolen inventory items, you must perfom two steps:

1. Add an inventory adjustment to the inventory stock item.

  • Go to the Stock Item and Edit it.

  • Select the Status/Adjustment tab

  • Add a new adjustment

  • Enter a minus quantity/amount into the On Hand, Paid For, and Cost Adjustment fields.

  • Select OK to save the adjustment.

The above example records two damaged vases that cost $25 each.

2. Lastly, you will need to make a change to the Inventory G/L account. To do this, you will enter a journal entry. The entry will credit the Inventory account and debit an expense or cost of goods sold account for Damaged Inventory or Goods.