I am trying to correct the COGS from last year for a company but I am not sure of the best way to do it. At the beginning of the year all purchases for resale were being recorded directly to COGS. In May someone decided to set up the inventory tracking system in Quickbooks, and recorded beginning inventory balances to the inventory asset account. For the rest of the year, the COGS was automatically recorded with each sale as the inventory asset account was simultaneously reduced. The problem is that by year-end the COGS balance is artificially high. Staff did do an inventory count at year-end, and I made adjusting journal entries to correct the inventory asset account balance. This did reduce the COGS slightly, but the amount is still too high based on the amount of sales that occurred before inventory tracking was set up in May. I need to make another adjustment that does not affect the inventory asset account, as that balance is actually correct.