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Sending manufacturing operations cost to QuickBooks Online

Learn about sending operation costs to QuickBooks Online for clearer financial tracking.

Dayvid Lorbiecke avatar
Written by Dayvid Lorbiecke
Updated this week

Integrating Katana with QuickBooks Online allows for accurate tracking of manufacturing operations costs, ensuring that your financial records reflect the true cost of production.


Understanding manufacturing operations cost

When you configure the QuickBooks Online integration in Katana to send purchase orders (POs) as bills to an inventory asset account, the following occurs:

  1. Purchasing materials:

    • A PO containing materials (e.g., $50 worth) is sent to QuickBooks as a bill.

    • The inventory account in QuickBooks increases by the bill amount ($50).

  2. Selling finished products:

    • A sales order (SO) for a finished product (e.g., costing $60) is invoiced from Katana to QuickBooks.

    • QuickBooks creates a journal entry that credits the inventory account by the product's cost ($60).

    • This results in a negative balance (-$10) in the inventory account, as only $50 was added from the PO.

  3. Addressing the discrepancy:

    • To reconcile the negative balance, an additional journal entry is needed in QuickBooks.

    • This entry increases the inventory account by the manufacturing operations cost (e.g., $10) and credits a liability account (e.g., "Salaries Payable").

By enabling the option to send manufacturing operations costs from Katana to QuickBooks, this adjustment can be automated.


Configuring the integration

To enable the sending of manufacturing operations costs:

  1. Access integration settings:

    • In Katana, navigate to the Integrations Marketplace.

  2. Configure QuickBooks Online:

    • Locate QuickBooks Online and click Open configuration.

      Screenshot showing where the Open configuration option is found for the QuickBooks integration in Katana

  3. Enable operation costs sync:

    • Check the box for Send Manufacturing operations cost to QuickBooks.

    • Select the appropriate liability account in QuickBooks to record these costs (e.g., "Salaries Payable").

  4. Activate the configuration:

    • Click Activate to finalize the setup.

      Screenshot of the QuickBooks configuration section, showing where you can check 'Send Manufacturing operations cost to QuickBooks" and then click Activate

Note: This feature requires that POs be sent as bills to an inventory asset account in QuickBooks.


Sending operation costs to QuickBooks Online

Once the integration is configured:

  1. Access manufacturing orders:

    • In Katana, go to the Make screen and select the Done tab.

  2. Select completed orders:

    • Choose one or more manufacturing orders (MOs) marked as Done.

  3. Initiate the sync:

    • Click on Send operation costs to QuickBooks.

      Screenshot showing the Send operations costs to QuickBooks button on the Make screen

This action will create a journal entry in QuickBooks, increasing the inventory account by the operations cost and crediting the selected liability account.


Handling reverted or deleted manufacturing orders

If an MO that has been marked as Done is later reverted or deleted in Katana:

  • The corresponding journal entry in QuickBooks will also be reversed.

This ensures that your financial records remain accurate and up-to-date across both platforms.


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