Thanks for posting here, Lisa.

I'll be sharing info about how inventory works QuickBooks Desktop (QBDT) when it comes to receiving the payment first before the good.

The inventory will be affected based on how you record the transactions. If you immediately record the bill and mark it as paid, QBDT will assume that there's an additional item in your inventory automatically despite having no actual physical stock.

However, if you record only the prepayment indicating that the item has not yet been received, the system will consider this an open transaction and there will be no increase in the inventory quantity.

Please know that there are two ways of entering the prepayments or deposits in the program, either by using Accounts Payable or an Asset account. It's recommended to seek advice from a qualified accounting professional to determine which option would be most suitable for your business.

For detailed instructions, feel free to read this article: Record vendor prepayments or deposits for prepaid parts or services.

Also, I'll share this article to help you understand how QuickBooks computes inventory values based on the assumption: FIFO Options in QuickBooks Desktop Enterprise.

If you want to learn which report will help you manage your inventory, check out this article: Understand inventory assets and cost of goods sold tracking.

The Community forum is always available if you have additional questions about managing your inventory goods. Take care, and have a good day.