• Material: An asset ACCOUNT that tracks material cost. For average costing, this account holds your inventory and in transit values. Once you perform transactions, you cannot change this account.
• Material Overhead: An asset account that tracks material overhead cost.
• Resource: An asset account that tracks resource cost.
• Overhead: An asset account that tracks resource and outside processing overheads.
• Outside processing: An asset account that tracks outside processing cost.
• Expense: The expense account used when tracking a non-asset item.

Other Accounts:

• Sales: The profit and loss (income statement) account that tracks the DEFAULT revenue account.
• Cost of Goods Sold: The profit and loss (income statement) account that tracks the default cost of goods sold account.
• Purchase Price Variance: The variance account used to record differences between purchase order price and standard cost. This account is not used with the average cost method.
• Inventory A/P ACCRUAL: The liability account that represents all inventory purchase order receipts not matched in Accounts Payable, such as the uninvoiced receipts account.
• INVOICE Price Variance: The variance account used to record differences between purchase order price and invoice price. This account is used by Accounts Payable to record invoice price variance.
• ENCUMBRANCE: An expense account used to recognize the reservation of funds when a purchase order is approved.
• Average Cost Variance: Under average costing with negative quantity balances, this account represents the inventory valuation error caused by issuing your inventory before your receipts.

Other Accounts: