Thanks for replying to this thread, @kndzpntnr.
 

I am here to help you understand the difference between Category and Item details when creating an expense. The Category detail is an account that you select from your chart of accounts. While the Item detail is an item from the products and services that you purchase and sell. It gives more specific information about the product or service.  
 

When creating an expense, it's up to you what category to select that fits the item. If you're still unsure of what to select, I recommend consulting your accountant for further guidance. 

With regard to your transaction that is sales tax exempt, we can make changes to it. I'll guide you how:

1. Go to the Sales menu, and select Products and Services.
2. Choose a product you want to edit and click on Edit.
3. In the Product/ Service information, click on Edit sales tax.
4. Select Nontaxable under other options.

You can also visit this article to learn more about expenses: Expenses in QuickBooks Online.

Please leave a reply if you have further questions about accounting transactions. I'd be happy to help. Have a nice day ahead!