Inventory adjustment

Using the Inventory Adjustment endpoint, you can adjust quantities for reasons such as damage, stock write-off, shrinkage, or expiration. The endpoint automatically handles the underlying accounting to ensure that quantity reflects correctly. This helps you build complex inventory use cases while ensuring that inventory data is consistent and accurate across both QuickBooks Online and your app. Your customers can view and verify inventory quantity and valuation using Inventory Valuation reports. This functionality is available for QuickBooks Online Plus and advanced SKUs in the US.

• Inventory adjustment is supported for US locales only.
• Multi-site (Inventory data warehouse locations) is not supported. Only primary site is supported. Class ref and location (department) ref are not supported.
• For updates, only partial update (sparse = true) is supported. A partial update means only the state sent in the request payload will be updated.

There are several use cases for Inventory Adjustment, including:

• Create Inventory Adjustment transactions to increase or decrease the inventory quantity on QuickBooks Online for an inventory item based on an underlying business workflow on your app, such as a stock correction, stock take, stock write-off, customer returns, transfer, or manufacturing.
• Read an adjustment entry by ID to retrieve the details of an adjustment, such as products, adjustment accounts, change in quantity, or transaction date.
• Update an adjustment entry to modify the details of the adjustment, such as quantity, products, or adjustment account.
• Delete an adjustment entry to remove the transaction from QuickBooks Online and reverse the effect on the inventory quantity.
• Read a list of Inventory Adjustment transactions based on filters such as product name or transaction dates.

The Inventory Adjustment APIs also handle errors occurring due to accounting validations. The APIs return specific error codes and messages for different validation scenarios that may occur while adding Inventory Adjustment entries to QuickBooks Online. Some of the accounting validation use cases are given below:

• Inventory Adjustment Transaction date should be after the Inventory Creation Date.
• Inventory Adjustment Transaction date should not be before the Books Closed Date.
• All the Inventory Items used on the Inventory Adjustment Transaction should be in an active state.
• The Inventory Adjustment Account, Classes and Locations, if specified, should be in an active state.

This section describes the QuickBooks Online Customer Inventory configuration setup required to support inventory adjustment tracking and management.

1. Go to your QuickBooks Online Company homepage.
2. Select the gear icon in the upper-right corner and choose Account and Settings under YOUR COMPANY.
3. In the left panel, select Sales and turn on Track quantity and price/rate and Track inventory quantity on hand.

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4. In the left panel, select Advanced. Under Categories turn on Track classes and Track locations:

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The chart of accounts and general ledger mappings can be viewed in the QuickBooks Online UI. For example, Inventory Asset account increases when inventory is added and Cost of Goods account increases when inventory is sold or removed.

If Track classes and Track locations are turned on in QuickBooks Online Settings as described above, this information is tracked by Inventory Adjustment.

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To close the books, go to Account and Settings > Advanced:

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After the books are closed, no inventory adjustments can be made for the company either through the UI or through the API.

To track classes and locations, use the Preferences endpoint. The Preferences object provides the same information as the UI settings:

• ClassTrackingPerTxnLine provides class tracking information, equivalent to Track classes.
• TrackDepartments provides location information, equivalent to Track locations.

The following shows an example object:

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"Preferences": [
   {
      "AccountingInfoPrefs": {
      "UseAccountNumbers": false,
      "TrackDepartments": true,
      "DepartmentTerminology": "Location",
      "ClassTrackingPerTxn": false,
      "ClassTrackingPerTxnLine": true,
      "FirstMonthOfFiscalYear": "January",
      "TaxYearMonth": "January",
      "TaxForm": "1",
      "CustomerTerminology": "Customers"
   },
]

The following are useful endpoints when working with item adjustments:

• To get the quantity on hand for the specified requested item, use Read an item.
• To get all the inventory adjustments, which returns the list of all transactions for the specified type, query the report.
• To get account info, query the account.

This section provides an example of how to adjust inventory. In this example, a user provides the following values to update the inventoryadjustment resource:

• Id: This is the Inventory Adjustment Id, or payload id.
• Line.Id: The position of the line items.
• Line.ItemAdjustmentLineDetail.ItemRef.value: The item variantIds (This is same value returned for Item.Id when making a Get Item call after migration.

To get the item to adjust, send the following request:

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   GET /v3/company/{{realmid}}/query?query=select * from Item where Id='1010000001'&minorversion=70

   {
    "QueryResponse": {
      "Item": [
          {
            "Name": "football",
            "Active": true,
            "FullyQualifiedName": "football",
            "Taxable": true,
            "UnitPrice": 0,
            "Type": "Inventory",
            "IncomeAccountRef": {
            "value": "79",
            "name": "Sales of Product Income"
         },
            "PurchaseCost": 100,
            "ExpenseAccountRef": {
            "value": "80",
            "name": "Cost of Goods Sold"
         },
         "AssetAccountRef": {
             "value": "81",
             "name": "Inventory Asset"
       },
       "TrackQtyOnHand": true,
       "QtyOnHand": 200,
       "ReorderPoint": 0,
       "InvStartDate": "2024-01-12",
       "TaxClassificationRef": {
              "value": "EUC-09020802-V1-00120000",
              "name": "General taxable retail products - use this if nothing else fits"
        },
        "domain": "QBO",
        "sparse": false,
        "Id": "1010000001",
        "SyncToken": "27",
        "MetaData": {
            "CreateTime": "2024-01-12T09:33:47-08:00",
            "LastUpdatedTime": "2024-05-12T20:13:20-07:00"
        }
        }
      ],
      "startPosition": 1,
      "maxResults": 1
      },
      "time": "2024-05-12T20:52:29.145-07:00"
   }

Create the inventory adjustment:

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  POST /v3/company/<realm_id>/inventoryadjustment?minorversion={{minorversion}}

     curl --location 'https://quickbooks.api.intuit.com/v3/company/1234567890123456/inventoryadjustment' \
     --header 'Content-Type: application/json' \
     --header 'Authorization: <auth>' \
     --header 'Accept: application/json'
     --header 'Content-Type: application/json'
     --data '{"AdjustAccountRef":{"value":"5","name":"Inventory Shrinkage"},"domain":"QBO","sparse":false,"MetaData":{"CreateTime":"2021-07-28T22:16:43-07:00","LastUpdatedTime":"2021-07-28T22:20:01-07:00"},"DocNumber":"2024","TxnDate":"2025-09-01","Line":[{"Id":"123","DetailType":"ItemAdjustmentLineDetail","ItemAdjustmentLineDetail":{"ItemRef":{"value":"1010000001"},"QtyDiff":20}}]}

 {
      "AdjustAccountRef": {
      "value": "5",
   },
   "domain": "QBO",
   "sparse": false,
   "DocNumber": "2024",
   "TxnDate": "2025-09-01",
   "Line": [
     {
         "Id": "1",
         "DetailType": "ItemAdjustmentLineDetail",
         "ItemAdjustmentLineDetail": {
             "ItemRef": {
                 "value": "1010000001"
             },
             "QtyDiff": 20
         }
     }
   ]
 }

The adjusted inventory item appears in the QuickBooks Online UI as shown below:

x

Inventory adjustments are tracked by Inventory Adjustment Id and displayed in the UI as shown below:

x

In this example, InventoryAdjustment.Id = 145500061

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The following is an example of how to use inventory adjustment–in this case, converting raw materials to finished goods. The example shows the steps for each part of the process and how the corresponding information displays in the UI. Assume it takes the following to convert the raw materials to finished goods:

• 1 unit of raw material A that costs $10
• 1 unit of raw material B that costs $5
• 1 unit of labor that costs $1

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We’ll first create the products, account, and expenses:

1. Create products for the raw material and finished goods:

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2. Create an account called WIP of Type Bank:

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3. Create expenses to purchase the raw materials. Here is the Purchase API request to purchase Raw Material A and Raw Material B:

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{
  "AccountRef":{
     "value":"35"
  },
  "PaymentType":"Cash",
  "EntityRef":{
     "value":"66",
     "name":"RawMaterialVendor",
     "type":"Vendor"
  },
  "Line":[
     {
        "Id":"1",
        "Amount":20.00,
        "DetailType":"ItemBasedExpenseLineDetail",
        "ItemBasedExpenseLineDetail":{
           "BillableStatus":"NotBillable",
           "ItemRef":{
              "value":"1010000042",
              "name":"Raw Material A"
           },
           "UnitPrice":10,
           "Qty":2,
           "TaxCodeRef":{
              "value":"NON"
           }
        }
      },
      {
        "Id":"2",
        "Amount":10.00,
        "DetailType":"ItemBasedExpenseLineDetail",
        "ItemBasedExpenseLineDetail":{
           "BillableStatus":"NotBillable",
           "ItemRef":{
              "value":"1010000081",
              "name":"Raw Material B"
           },
           "UnitPrice":5,
           "Qty":2,
           "TaxCodeRef":{
              "value":"NON"
           }
        }
     }
  ]
}

Once these are created, they appear as follows in the UI:

x

The quantity is updated as shown here:

x

4. Add an expense for the labor and set the expense reason as WIP:

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"AccountRef":{
     "value":"35"
  },
  "PaymentType":"Cash",
  "EntityRef":{
     "value":"67",
     "name":"Labor",
     "type":"Employee"
  },
  "Line":[
     {
        "Id":"1",
        "Amount":1.00,
        "DetailType":"AccountBasedExpenseLineDetail",
        "AccountBasedExpenseLineDetail":{
           "AccountRef":{
              "value":"92",
              "name":"WIP"
           },
           "BillableStatus":"NotBillable",
           "TaxCodeRef":{
              "value":"NON"
           }
        }
     }
  ]
}

This appears in the UI as follows:

x

5. Create the inventory adjustment to reduce the quantity of the raw materials to zero. The following is the Inventory Adjustment API request:

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{
  "AdjustAccountRef":{
      "value": "92"
   },
  "domain":"QBO",
  "sparse":false,
  "DocNumber":"51",
  "TxnDate":"2024-05-31",
  "Line":[
     {
         "Id": "1",
         "DetailType":"ItemAdjustmentLineDetail",
         "ItemAdjustmentLineDetail":{
           "ItemRef":{
              "value":"1010000081"
           },
           "QtyDiff":-1
        }
     },
     {
        "Id": "2",
        "DetailType":"ItemAdjustmentLineDetail",
        "ItemAdjustmentLineDetail":{
           "ItemRef":{
              "value":"1010000042"
           },
           "QtyDiff":-1
        }
     }
  ]
}

Response:

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"InventoryAdjustment": {
    "Id": "1455000166",
    "AdjustAccountRef": {
        "value": "92",
        "name": "Inventory Shrinkage"
    },
    "TxnDate": "2024-05-31",
    "PrivateNote": "",
    "DocNumber": "51",
    "MetaData": {
        "LastUpdatedTime": "2024-05-31"
    },
    "SyncToken": "0",
    "Line": [
        {
            "ItemAdjustmentLineDetail": {
                "ItemRef": {
                    "value": "1010000081"
                },
                "QtyDiff": -1
            },
            "Id": "1"
        },
        {
            "ItemAdjustmentLineDetail": {
                "ItemRef": {
                    "value": "1010000042"
                },
               "QtyDiff": -1
            },
            "Id": "2"
        }
    ],
    "domain": "QBO",
    "sparse": false
},
"time": "2024-05-31T13:58:07.001-07:00"

This appears in the UI as follows:

x

Now the WIP is $16:

x

6. For the last step, adjust the inventory for the finished good to +1. Here is the Inventory Adjustment API request:

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{
  "AdjustAccountRef":{
      "value": "92"
   },
  "domain":"QBO",
  "sparse":false,
  "DocNumber":"51",
  "TxnDate":"2024-05-31",
  "Line":[
     {
        "DetailType":"ItemAdjustmentLineDetail",
        "ItemAdjustmentLineDetail":{
           "ItemRef":{
              "value":"1010000062"
           },
           "QtyDiff":1,
           "PrivateNote": "Convert Raw material to finished goods"
        }
     }
   ]
}

Response:

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{
   "InventoryAdjustment": {
       "Id": "1455000171",
       "AdjustAccountRef": {
           "value": "92",
           "name": "Inventory Shrinkage"
       },
       "TxnDate": "2024-05-31",
       "PrivateNote": "",
       "DocNumber": "51",
       "MetaData": {
           "LastUpdatedTime": "2024-05-31"
      },
      "SyncToken": "0",
      "Line": [
        {
            "ItemAdjustmentLineDetail": {
               "ItemRef": {
                  "value": "1010000062"
               },
               "QtyDiff": 1
            },
            "Id": "1"
         }
      ],
      "domain": "QBO",
      "sparse": false
   },
   "time": "2024-05-31T14:03:58.941-07:00"
}

This appears in the UI as follows:

x

With this change, WIP goes to zero:

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The raw material has now been converted to finished product:

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For a detailed list of error codes, see Review QuickBooks Online Accounting API error codes.

Any errors not described on the Errors page are returned with error code = 6000 in the following format:

Message = BusinessValidationError : <message details>

The system supports only 500 line items in an adjustment. If more than 500 line items are included in a create or update adjustment, the system throws a validation error with the message:

Provided Adjustment Line Items exceed the max limit. Please reduce the line items.

If a value for the SyncToken attribute is not provided during an update operation, this may result in an error similar to the following:

{"Fault":{"Error":[{"code":"6000","Message":"Validation error with user input","Detail":"Variable \"$input\" got invalid value { id: \"1455000298\", adjustmentAccountId: \"5\", adjustmentDate: \"2023-08-25\", referenceNumber: \"2014\", reason: \"SHRINKAGE\", adjustmentLineItems: [[Object]] }; Field \"version\" of required type \"Long!\" was not provided."}],"type":"ValidationFault"}, "time":"04:33:10.209637"}

The following are solutions to errors caused by common API mistakes.

{"Fault":{"Error":[{"Message":"A business validation error has occurred while processing your request","Detail":"Business Validation Error : You need to provide accounts element id","code":"6000","element":""}],"type":"ValidationFault"}, "time":"2024-07-11T08:04:50.559-07:00"}

If this error occurs, check that AdjustAccountRef.value in your request payload is set to a valid existing account id for your company realm. To see a list of valid account id values, query the account as in the following example:

GET /v3/company/<realmID>/query?query=Select * from Account where Name='Inventory Shrinkage'&minorversion=70

For more on this endpoint, see Query an account.

{"Fault":{"Error":[{"Message":"Unsupported Operation","Detail":"Operation Could not find resource","code":"500"}],"type":"ValidationFault"},"time":"2024-07-11T08:02:01.180-07:00"}

If this error occurs, check the following:

• Create, Update, and Delete are POST operations.
• In the Create request payload, Id does not need to be provided in the request body.
• For the Update request payload, the AdjustAccountRef.value attribute must be a valid/existing account value for your company realm and the sparse attribute must be set to true.