The quick answer
Open Lists > Accounting > Items > New and choose Inventory Item. Enter the item name, units type and subsidiary. On the Purchasing/Inventory subtab pick the costing method before you save, because you should treat it as permanent once the item is saved. On Sales / Pricing enter the base price and watch the price levels that have a default percentage fill in from it, then type a price into any level that has none. On Accounting check the asset, income and COGS accounts and choose a tax schedule. Save the item and read the same values on the saved record.
The screenshots show sample data. Company, person, item and account names are fictional. Use your own records and values when following the steps.
Before you start
This example runs in a OneWorld account with Multiple Prices turned on, one currency, Legacy Tax and an account that offers the Average costing method. Yours may differ, because the fields you see and the setup you need depend on enabled features, tax configuration, subsidiaries, currency settings, your role and the form. It covers a plain inventory item. Lot numbered, serialized, matrix and assembly items show different fields. Harborline Outfitters is adding WB-750 Insulated Water Bottle, 750 ml to its catalog, and Mina Castillo, an administrator, sets it up before the first purchase order. Your role needs permission to create inventory items and to use the subsidiary and the accounts, and the accounts must be active and valid for that subsidiary. The account numbers and names in the screenshots are examples. Menu paths and the names of subtabs and price levels differ by role and release.
01. Open a new inventory item
Go to Lists > Accounting > Items > New and choose Inventory Item. The form that opens is the Standard Inventory Part Form here, though your account may name it differently. Check that the page title reads Inventory Item before you type anything.
02. Enter the identity, units and subsidiary
Enter WB-750 as the Item Name/Number and Insulated Water Bottle, 750 ml as the Display Name/Code. Choose Each as the Units Type. That makes the unit fields available and fills them with Each as a default, and you can change them within the type. Select Harborline US as the Subsidiary and check Include Children to make the item available to that subsidiary's children as well. The box does nothing unless the subsidiary has children.
03. Choose the costing method
Open the Purchasing/Inventory subtab and look at the Costing Method list. Here it offers Average, FIFO, LIFO and Standard, and your list depends on your features and item type. Average keeps a moving average cost. FIFO and LIFO assume the oldest or newest cost layers are used first, which is a costing convention and says nothing about which unit physically ships. Standard uses a predetermined cost, and differences from it show up as variances under your standard cost setup. Keep Average for this item. Cost Category appears when your costing features expose it. It groups the item for cost accounting and holds no cost, so leave it at Default Cost Category. Choose the method now and treat it as permanent once you save. Fixing it later can mean a controlled conversion, a replacement item or accounting remediation.
04. Enter the base price
Open the Sales / Pricing subtab and type Insulated water bottle, 750 ml as the Sales Description. In the price matrix, enter 25.00 in the List Price row. That row is the base price level here, and some accounts call it Base Price, so use the label you see. Dealer (-10%) fills in as 22.50 and Resale (-25%) as 18.75, because those two levels are set up with a default discount. Online Price has no default discount, so NetSuite has nothing to calculate and leaves it empty. Type 23.50 into it yourself. The Qty 0 column holds the price for the base quantity, and quantity breaks, customer pricing and price rules can change the rate on a transaction. If your account uses Multiple Currencies, each currency tab has its own matrix, and a price typed on one tab applies to that tab only.
05. Assign the accounts and tax schedule
Open the Accounting subtab. The form fills in account defaults where your accounting preferences set them, so read each one before you accept it. The numbers and names here are examples. The Asset Account is 1300 Inventory Asset and the COGS Account is 5000 Cost of Goods Sold, which suit this item. The Income Account arrives as 4900 Miscellaneous Income, so change it to 4000 Product Sales. Then choose Taxable as the Tax Schedule. These accounts are the item-level defaults that later transactions use. An item receipt generally debits the asset account and credits an accrued purchases account, an invoice or cash sale generally credits the income account, and an item fulfillment generally debits the COGS account and credits the asset account at the item's cost. The details change with the transaction type, your preferences, the subsidiary, the costing method and any customization. Tax Schedule is the item's tax treatment under Legacy Tax. Under SuiteTax, tax registrations, nexus, tax codes and the transaction also drive the result, so the item's schedule is one input.
06. Save and check the item
Click Save. NetSuite shows Item successfully Saved and opens the item record. Saving creates the item master. It adds no quantity on hand, no inventory value and no ledger posting, and it stores the values you entered, including prices, accounts, the tax schedule and any Purchase Price. Open the Purchasing/Inventory subtab and check that Costing Method reads Average. Open Sales / Pricing and read the price levels. Open Accounting and read the accounts and the tax schedule. A Purchase Price is a purchasing default, and vendor pricing can override it on a purchase. It is not the inventory cost. Inventory cost comes from a transaction that adds stock, such as a receipt, an opening balance, an adjustment, an assembly build or a transfer. The saved record doesn't prove that the first transaction will use these values, so check the first purchase and the first sale too.
Check the result
- Costing Method on the Purchasing/Inventory subtab is the one you meant to keep, Average in this example.
- Sales / Pricing shows the list price and every level you expect. A level without a default percentage is empty until you type a price into it.
- Accounting shows the asset, income and COGS accounts you chose, and the tax schedule.
- No quantity on hand shows yet. A receipt, an opening balance or an adjustment adds it.
Common questions
Can I change the costing method after I save the item?
Plan on no. Treat the method as permanent once the item is saved. Correcting it later can mean a controlled conversion, a replacement item or accounting remediation, and it gets harder once transactions exist. Decide on the method with your accountant before you create the item. The default method comes from your accounting preferences, and the item can override it where your role and features allow.
Why is a price level empty after I enter the base price?
A level only calculates when it is set up with a Default Discount %. A level without one has no formula, so you enter its price yourself, as Online Price shows in this example. If a level that should calculate is empty, check its default percentage, the currency tab, the quantity column and whether the level is active.
Will the price levels update if I change the base price later?
Don't count on it. NetSuite calculates the percentage levels when you enter the price on the item, and it doesn't necessarily refresh the prices already stored on it when you edit the base price later. After any change, read the levels again. A process that updates existing prices from a price level can recalculate them, and it can also overwrite prices that someone typed in by hand.
What do the asset, income and COGS accounts control?
They are the item-level defaults that later transactions use. An item receipt generally debits the asset account and credits an accrued purchases account. An invoice or cash sale generally credits the income account. An item fulfillment generally debits the COGS account and credits the asset account at the item's cost, and the selling price doesn't set that cost. The transaction type, your preferences, the subsidiary, the costing method and any customization change the details.
Does saving the item create a cost, quantity or posting?
Saving creates the item master. It adds no quantity on hand, no inventory value and no ledger posting, and it stores the prices, accounts, tax schedule and Purchase Price you entered. Inventory cost comes from a transaction that adds stock, such as a receipt, an opening balance, an adjustment, an assembly build or a transfer, under the item's costing method.
Is Purchase Price the same as inventory cost?
No. Purchase Price is a purchasing default, and vendor pricing and purchasing rules can change the rate on an actual purchase. The inventory cost comes from the transaction that receives or creates the stock, under the costing method you chose.
Why does my form look different or ask for other fields?
The form name, the subtabs and the required fields depend on your role, your custom form, the item type, the subsidiary setup, your tax configuration and the features your account has enabled. A mandatory custom field or a workflow can add requirements. A missing field can mean your form or role hides it. Under SuiteTax, Tax Schedule may not be required or may not work the same way. Follow the labels on your own form.