Getting Started: Conducting a Physical Inventory

Physical Inventory Overview

Basic

A physical inventory (PI) is an actual count of the merchandise in stock. The Physical Inventory utility is the quickest way to update on-hand quantities for a large number of items in inventory.

A physical inventory is always recommended as part of the startup procedure and periodically thereafter to verify and adjust inventory counts.

A physical inventory involves:

- Recording physical counts for every individual item in the store

- Entering these physical counts into Point of Sale so the program can compare the counted quantities to the currently recorded quantities on hand in inventory

- Reviewing any discrepancies found

- Updating your inventory on-hand quantities to reflect your physical inventory counts

- The automatic creation of adjustment memos by Point of Sale to track the quantity changes and update your inventory value in QuickBooks Desktop financial software

For more information about conducting a physical inventory, click the Physical Inventory Overview link at the top of this page.