Backorders in QuickBooks

If you have inventory, there may be times you need to record backorders in QuickBooks. So how does QuickBooks handle backorders? It’s easier that you might think.

Handling Backorders in QuickBooks

The first step in this process is to create a purchase order from the home page icon (shown below).

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Create the purchase order for the desired number of inventory parts, in this example we will order 10.

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Next, receive the merchandise from the supplier. In our example, the supplier was only able to send 5 in the first shipment. We need to show that 5 are on backorder. Click on the receive inventory icon, select the supplier name. You will see a popup box asking you to select the appropriate purchase order. Once you have the purchase order opened, change the quantity to the amount that is actually being received, in our example 5. Save and close.


So now what happens? If you go back to the original purchase order, a little magic has happened in QuickBooks. You now see two new columns: Backordered and Received.

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In addition, the Open Purchase Orders Detail report will be updated to show this information.

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Tracking Backorders for Customers

So what happens if this order was for a specific customer and they need it right away? Backorders can also be tracked on Sales Orders and Invoices.

In our example, the customer ordered 10, but after the first shipment we are only able to send 5.

First, open the customer Sales Order. Select “Create Invoice”.

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Next, create an invoice for the amount you are able to ship, in this case 5. The invoice will now show the amount that was ordered and the amount fulfilled.

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The Sales Order now also shows this information.

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The Open Sales Order by Item Report is also updated to include this information.

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