How is being negative stock handled in relation to P&L?

1

Sold quantity 4 of one item, with only 2 on hand in inventory I now show -2. My cost is $18.00 each and sell price is $30.00 each. Sales of Inventory Items shows $120.00.

Purchase of Inventory Items is $36.00 only counting 2 on hand at time, will my P&L change to $72.00 when I order and input new stock?

2

To be honest, I don’t know because I was thinking to make it that way but don’t remember whether I got around doing it actually.

Try it on some dummy file and let me know.