Setting up your company file for the hand-over item is a two step process. First, you'll create a new asset account. Then you'll create a new inventory item, linking it with that account.

1. Create a new asset account (Accounts > Accounts List > New) and name it Work In Progress. This account will hold the old item that has been handed in.
   

2. With the Work in Progress account created, the next step is to Create the inventory item for the item that's being changed over.

   Keep the following in mind when creating the item:

   • In our example, a Heater is being changed over, so we'll name the item Heater Change Over, but your item name will depend on your business needs.
   • In the Item Number field, enter the same item number as the saleable item but with a 'C' at the end. In our example, a Heater's item number is 1234, so our handed-over item will be 1234C. This will signify in your records that it is a change over item that it not ready for resale.
   • Check the I Buy This Item and I Inventory This Item boxes, making sure to select the Work in Progress account created in Step 1.

   

A contra account (also called a clearing account) offsets the balance of another account. The Contra Cheque Account you'll create will offset your normal chequing account when tracking items you change over. This account will be linked to an inventory item that will be used on your invoices.

1. Create a contra account. See our page Create detail and header accounts for more information on creating accounts, but keep the following in mind:
   
   • This will be an Asset Account Classification.
   • This will be a Bank Account Type because it's offsetting your normal chequing account.
   • Name the account Contra Account
     
   
   
2. With the contra account created, it's time to link it with the item that's going to reduce the sale price of the reconditioned item. In our example, this tracks the $20 discount on the reconditioned heater offered to the customer. 

• • Name the item Generic Change Over Return 
  • Check the box for I Sell This Item.
  • Link the income account to the Contra Account created above. You'll get a message saying "The account for tracking sales is usually an income account". Ignore this warning, since this is a unique case for changing over inventory. 

Record a new sale of the reconditioned item sold to the customer. Enter the relevant customer and invoice details. When entering the items on the invoice, you'll record:

• Details of the new reconditioned item being sold (for example, the Heater) on the first line.
• Generic Change Over item in a negative Ship amount on the second line. This reduces the overall debt of the customer (in our example, by $20) and puts the Change Over Return amount into our contra account.

Next, Create a Purchase Bill for the actual old item that has been handed in.

Click Reimburse to see a list of all the job purchases and expenses you have assigned a job number to, that can now be reimbursed on the sale.

You should enter the credit limit you've assigned in each customer's card. If you want to stop sales from being recorded for customers who have exceeded their credit limit, you can place them on hold.