Why Cost of Goods Sold Accounts Cannot Be Subdivided: Creating a New Parent Account to Resolve Transaction Linking

Clarification about the possibility of subdividing the Cost of Goods Sold account, where you cannot subdivide the Cost of Goods Sold account if it is linked to financial transactions or products.

Alternative Solution

Create a new parent account with the same classification, then move the old account to become a branch under it.

Steps

1. Open the Chart of Accounts

   • From the Accounting menu > Chart of Accounts

2. Add a new parent account

   • Click the ( + ) button next to Direct Costs

   • Account type: Cost of Sales

   • Account name: for example, “Cost of Goods Sold Parent”

   • Fill in the data and save

3. Move the old account

   • Click Move next to the Cost of Goods Sold account

   • Select the new account as the parent account

   • Click Save

Explanatory Video

Subdividing Cost of Goods Sold

Important Notes

• The only solution is to reorganize the accounts in this way

Keywords:

Can I subdivide the Cost of Goods Sold account?