Handle Demos, Donations, or Expired/Product Loss

To handle retail items used as demonstrators, donated products, lost, expired, or other similar business-related situations, we recommend creating one profile called Business Supplies to invoice and remove them from inventory. Invoices coded with the sale type of Business Supplies will also prompt for an expense category. Once an expense category is selected and the invoice saved, an entry will automatically be created so that your tax reports reflect the items being removed from inventory and expensed out as well.

Note: The steps below should only be used for retail items. The Product Purchases report tracks the amount spent on business supplies and samples (section 2).

Step 1: Create a Business Supplies Profile (if necessary)

Only one profile must be created for all business-related situations to handle all situations (demos, given to charity, lost in shipment, etc.) for multiple tax years. Each invoice can be assigned to a specific expense category and grouped separately, as well as the date. Only invoices and expense entries within the date range set will be included when running tax reports. If you do not have a contact profile created for Business Supplies, follow the steps below.

1. Create a customer profile called Business Supplies.
2. From the profile toolbar, select  Settings (in Utilities).
3. Under the Discounts drop-down list, select Business Supplies (this will set the Invoice Followup to 0 days, Email Invoice to No, and the Discount to 50%, which can be adjusted).
4. Under Options, check to Exclude from Dashboard. 
5. Click   OK   to close Profile Settings, and when prompted to save, click Yes.
6. Click  Save, then close the profile.

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Step 2: Invoice & Select the Expense Category

The Business Supplies contact profile can be used to invoice retail products removed from inventory for business purposes (e.g., demos, donations, lost, damaged, or expired products). When creating a Business Supplies invoice, you will be prompted to select an Expense Category for invoiced items. Once saved, an entry is then added to your expenses.

1. Create a new invoice under the Business Supplies profile (Sale type should be set as Business Supplies), and add items that will be expensed under the same category.
2.  Under the Discount section, select the appropriate category from the Expense Category drop-down list (use the suggestions below or seek advice from your tax professional).
3. Click to the left of the Cash/Check field to mark the invoice as paid in full.
4. For additional information, enter a short description in the Memo field (such as Demo, Expired, or Charity).
5. When finished, click  Save. Repeat the steps above to create additional invoices for items expensed under other categories.

Suggested Categories:

For more information on categories or to create a new one, see Expense Categories, Payees & Filters.

• Supplies (COG): Retail items used as demos
• Gifts: Items for an event not tied to a specific recipient
• Advertising: Items used as a giveaway to obtain leads
• Charity: Items donated to a shelter or other charitable organization
• Expired/Lost: Product that is past its prime and being thrown out (See Track Product Expiration Dates for more information). Another use for this category would be products lost or damaged in shipment to a customer.

Tip:  By invoicing your Business Supplies profile for situations when items are being removed from inventory, all of the invoices will be grouped and easily accessible on the Gross Receipts report or can be printed separately (see Filter Invoices by Name, Invoice, or Discount Type for detailed steps).

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Additional Information:

• Handling Personal Use
• Close Year-End & Run Tax Reports