When I purchase items, they are correctly added to my inventory items.
However, when I sell those items, the quantity is not reduced from inventory on hand, and there is no impact on inventory cost or Cost of Goods Sold (COGS).
As a result, the entire sales amount is being recorded as profit, without deducting the cost of the sold items.
Because of this, my Profit & Loss report is incorrect and overstated.
I would like to understand why inventory on hand quantities are not decreasing after sales and why inventory cost is not being transferred to expenses when items are sold.
Please advise how I can properly set up inventory so that:
Inventory quantities decrease upon sales
Cost of Goods Sold is recorded correctly
Profit is calculated accurately