How to Create a Purchase Order in QuickBooks?

Creating a purchase order in QuickBooks is a crucial task for businesses to manage their inventory and expenses effectively. This step-by-step guide will walk you through the process of creating a purchase order in QuickBooks, ensuring that your purchasing process remains organized and efficient.

What is a Purchase Order?

A purchase order (PO) is a document sent from a buyer to a supplier, listing the items the buyer intends to purchase, their quantities, and agreed prices. It serves as a formal request for goods or services and provides a clear record of the transaction for both parties.

Why Use Purchase Orders in QuickBooks?

Using purchase orders in QuickBooks offers several benefits:

1. Streamlined Purchasing Process: Simplifies tracking orders and inventory.
2. Improved Record Keeping: Maintains detailed records of all purchases.
3. Enhanced Communication: Clarifies purchase terms between buyers and suppliers.
4. Budget Management: Helps monitor and control business expenses.

Benefits of Creating Purchase Orders in QuickBooks

• Accuracy: Ensures accurate records of what has been ordered and at what price.
• Efficiency: Saves time by automating the purchasing process.
• Accountability: Provides a clear trail for audits and financial reviews.
• Integration: Seamlessly integrates with other QuickBooks features for comprehensive financial management.

How to Create a Purchase Order in QuickBooks?

Below are the following steps to create purchase order in QuickBooks:

Step 1: Enable Purchase Orders

Before creating a purchase order, ensure the purchase order feature is enabled in QuickBooks.

1. Go to the Gear icon in QuickBooks.
2. Select Account and Settings.
3. Click on the Expenses tab.
4. In the Purchase orders section, turn on the Use purchase orders toggle.
5. Click Save and then Done.

Step 2: Create a Purchase Order

Once the purchase order feature is enabled, follow these steps to create a purchase order:

1. Navigate to the + New button on the left-hand side of the QuickBooks dashboard.
2. Select Purchase Order from the drop-down menu.
3. Fill in the necessary details:
   • Vendor: Select the vendor from whom you are purchasing.
   • Ship To: Enter the address where the goods should be delivered.
   • Date: Set the date of the purchase order.
   • PO Number: QuickBooks will automatically generate a PO number, but you can edit it if needed.
4. Add the items you are ordering:
   • Product/Service: Select the items from your inventory list.
   • Description: Provide a description of the items.
   • Quantity: Enter the quantity of each item.
   • Rate: Set the price per unit.
   • Amount: QuickBooks will calculate the total amount.
5. Review the purchase order for accuracy.
6. Click Save and Send to email the purchase order to your vendor, or Save and Close to save it without sending.

Conclusion!!

Creating purchase orders in QuickBooks is a straightforward process that helps streamline your purchasing activities, ensures accurate record-keeping, and improves overall business efficiency. By following the steps outlined in this guide, you can easily manage your purchases, keep track of your inventory, and maintain good relationships with your suppliers.

Frequently Asked Questions (FAQs):

Q1. Can I customize the purchase order template in QuickBooks?

Ans: Yes, you can customize the purchase order template by going to the Custom Form Styles section under the Gear icon.

Q2. How do I receive items against a purchase order in QuickBooks?

Ans: To receive items, go to Expenses, select Receive Inventory, choose Receive Inventory with Bill, and link it to the corresponding purchase order.

Q3. Can I convert a purchase order into a bill in QuickBooks?

Ans: Yes, you can convert a purchase order into a bill by selecting the purchase order and clicking on Create Bill.

Q4. Is it possible to track the status of my purchase orders in QuickBooks?

Ans: Yes, QuickBooks allows you to track the status of your purchase orders, showing whether they are open, partially received, or closed.

By effectively utilizing the purchase order feature in QuickBooks, you can enhance your purchasing process, maintain accurate records, and ensure smooth operations in your business.

Source: https://medium.com/@proqbadvisor/how-to-create-a-purchase-order-in-quickbooks-e06c42f55280