Summary
Description
Create product and service records for items you buy and sell regularly. Here you set a code and description, cost and sales prices, default ledger account and categories for grouping similar items.
If you subscribe to Accounting Plus, set products as stock items to track your stock levels and set reorder levels.
If you have details of your products and services in another system, consider importing them using a CSV file. See Import product and services from a CSV file.
Resolution
What you need to know
Create different types of products
- Stock – These are product items that you want to count and track. When you buy and sell these items, the number in stock is increased or reduced. You can also report on all the activity of your stock items
- Non-stock – These are physical product items that you buy and sell, but don’t want to keep track of. You can still add them to sales and purchase invoices but the number in stock isn’t recorded
- Service – These are non-physical items that you buy and sell. For example, if you're a training company, you might set up a service record for each training course. A computer repair company may have stock and non-stock items to track hardware items but also enter service items for other work done, such as software upgrades or virus removal
Before you start
- Set up categories if you want to group similar items together. See the Manage product categories article
- Set up defaults and labels in the Record and transaction settings. See Product and services settings article
Set up names for sales prices and service rates.
Set up default sales and purchase ledger accounts.
Set up default sales and purchase VAT rates.
Create a new product or service
- Select Products & Services.
- Select New Item.
- Select Stock, Non-stock or Service.
- All records must have an Item Code and Description.
- If you sell this item, complete the details in the I sell this item section.
- If you buy this item, then complete the details in the I Buy This Item section.
Categories
These are an easy way for to group similar items together for reporting purposes.
Assign categories and subcategories to items, then filter on reports such as the Sales Revenue report and Stock Movement Summary report.
Non-stock fields explained
Sales prices
Set up three different prices for each item. We've called these Sales, Trade or Wholesale by default.
- Enter a price for each price name
- Choose Includes VAT to set the gross price including VAT. When entered on an invoice, the VAT is deducted from this price
EXAMPLE: If the price of the item including VAT is £100, the net amount would be £83.33 and the VAT would be £16.67.
If the price of the item is £100 excluding VAT the net value is £100 and the VAT is £20 - Change the names for the prices for something more suitable to your business in the Record and Transaction settings
- Just use one or two prices. Choose which price to use in the Record and Transaction Settings
Sales Ledger Account
This is the ledger account where you store the total value of sales for this item.
Choose a suitable ledger account here. This should be a Sales or Income ledger account.
To store the value of all your sales in the same ledger account, set this as the default in the Record and Transaction Settings.
Sales VAT rate
This is the VAT rate used by default when this item is added to a sales invoice or credit note
Cost price
This is the usual price you pay for the item. When you enter a purchase invoice or credit note, this price is used by default but you can change it.
Usual Supplier
This is just for you to note who you usually buy this item from.
Purchase Ledger Account
This is the ledger account where you store the total cost of buying this item.
Choose a suitable ledger account here. This could be under Direct Costs or Overheads.
Direct costs v Overheads
- A direct cost is related to the amount it costs you to produce something that you sell, such as the cost of buying a product to resell, or the materials or labour used to create something that you sell
- An overhead is a cost to your business not directly related to what you sell, such as salaries, utility bills, rent etc
To store the value of all your purchases in the same ledger account, set this as the default in the Record and Transaction Settings.
Purchase VAT rate
This is the VAT rate used by default when this item is added to a purchase invoice or credit note.
Services field explained
Service rates
Set up to four different rates to charge for this service. We've called these STD, Premium, Overtime etc.
- Enter the sales price for each rate
- Choose Includes VAT to set the gross price including VAT. When entered on an invoice, the VAT is deducted from this price. EXAMPLE: If the price of the item including VAT is £100, the net amount would be £83.33 and the VAT would be £16.67. If the price of the item is £100 excluding VAT the net value is £100 and the VAT is £20
- Change the name of the rates to something more suitable to your business such as labour in the Record and Transaction Settings
- Choose the number of different rates you want to use in the Record and Transaction settings
Sales Ledger Account
This is the ledger account where you store the total value of sales for this item.
Choose a suitable ledger account here. This should be a Sales or Income ledger account.
To store the value of all your sales in the same ledger account, set this as the default in the Record and Transaction Settings.
Sales VAT rate
This is the VAT rate used by default when this item is added to a sales invoice or credit note
Usual Supplier
This is just for you to note who you usually buy this item from.
Purchase Ledger Account
This is the ledger account where you store the total cost of buying this item.
Choose a suitable ledger account here. This could be under Direct Costs or Overheads.
Direct costs vs Overheads
- A direct cost is related to the amount it costs you to produce something that you sell, such as the cost of buying a product to resell, or the materials or labour used to create something that you sell
- An overhead is a cost to your business not directly related to what you sell, such as salaries, utility bills, rent etc
To store the value of all your purchases in the same ledger account, set this as the default in the Record and Transaction Settings.
Purchase VAT rate
This is the VAT rate used by default when this item is added to a purchase invoice or credit note.
Stock item fields explained
Sales Prices
Set up three different prices for each item. We've called these Sales, Trade or Wholesale by default.
- Enter a price for each price name
- Choose Includes VAT to set the gross price including VAT. When entered on an invoice, the VAT is deducted from this price EXAMPLE: If the price of the item including VAT is £100, the net amount would be £83.33, and the VAT would be £16.67. If the price of the item is £100 excluding VAT, the net value is £100, and the VAT is £20
- Change the names for the prices for something more suitable to your business in the Record and Transaction settings
- Just use one or two prices. Choose which price to use in the Record and Transaction Settings
Sales Ledger Account
This is the ledger account where you store the total value of sales for this item.
Choose a suitable ledger account here. This should be a Sales or Income ledger account.
To store the value of all your sales in the same ledger account, set this as the default in the Record and Transaction Settings.
Sales VAT rate
This is the VAT rate used by default when this item is added to a sales invoice or credit note
Usual Supplier
This is just for you to note who you usually buy this item from.
Purchase Ledger Account
This is the ledger account where you store the total values of your goods in stock.
Choose a suitable ledger account here. This is usually an asset account, reported on your balance sheet.
To store the value of all your purchases in the same ledger account, set this as the default in the Record and Transaction Settings.
Purchase VAT rate
This is the VAT rate used by default when this item is added to a purchase invoice or credit note.
Reorder levels and quantity
These options allow you to note when you want to reorder your stock items and the amount you usually reorder.
When the amount in stock falls below the reorder level and warning triangle is shown on the products and services list.
Opening balances
If you know how much stock you currently hold for this item, you can enter it here.
This updates the available stock for the item and will show as a Quantity on the Stock Movement report. Include a cost price to ensure the total value of your stock is up to date.
If you don't know your opening balance now, you can enter it later as a stock adjustment.
Additional information
Here you can record more useful information about your stock item for your own use. They are not used anywhere in the software.
Africa
Asia
Australia
Canada
France
Kenya
Nigeria
South Africa
Spain
United Arab Emirates
United Kingdom
United States