@Heather5586 

Go to: Sales > Products and Services > New > Inventory

Enter:

1) The name of the product

2) Enter the initial quantity on hand (1) and enter a date prior to the date you sold the item.

3) Assign it to your inventory asset account.

4) Assign the appropriate income account. 

5) Enter cost.  This is what you paid for the item (~$50).

6) Confirm the expense account is listed as cost of goods sold.

Click save and close.

This will put the item into inventory at $50 cost and create a corresponding $50 entry to opening balance equity since this is your investment in the business.  Now, when you ring up the sale, $50 will be taken out of inventory and $50 will be booked to cost of goods sold, leaving a gross profit of $138.