ANS-1312 · INVENTORY & ITEM MANAGEMENT
Why Do Non-Inventory Items in NetSuite Kits Not Impact COGS?
Understand how NetSuite processes the Cost of Goods Sold for kit members, specifically differentiating between inventory and non-inventory items.
Short answer
NetSuite Kit items only generate a Cost of Goods Sold (COGS) impact for their inventory members. If a kit includes non-inventory items, such as service items, their sale as part of the kit will not result in a corresponding COGS entry on the General Ledger. This behavior is standard for how NetSuite handles kit item accounting.
Scenario
When a Kit item is sold in NetSuite, users may observe that the General Ledger (GL) impact for Cost of Goods Sold (COGS) does not reflect all members of the kit. Specifically, if the kit contains non-inventory items like service items, their contribution to COGS appears to be absent, leading to questions about the completeness of the financial impact.
Solution
NetSuite's standard functionality dictates that when a Kit item is sold, the General Ledger (GL) impact for Cost of Goods Sold (COGS) is generated exclusively for its inventory members. Non-inventory items, such as Service Items, when included as members of a Kit, do not generate a COGS impact upon the sale of the kit. Therefore, only inventory items within a kit will contribute to the COGS entry on the General Ledger.
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