I set my products to real time like you suggest (1) settings->warehouse->generate accounting entries per stock movement 2) Under the product page, I select real time 3) I created an input and an output account) What is the value of the input and output account?

Perhaps my question is not clear. Let me tell you what happens, then tell you what I was hoping to have happen. Here are the journal entries: When purchasing: debits purchase and credits input. When manufacturing: debit output and credits input. When making a sale debit output and credit purchase. The net effect of a cycle is ouput debited for 2x the purchase amount, input credited for 2x the purchase amount, and the purchase is properly gone back to 0. I don't see any mechanism for reducing the input or output accounts except a manual entry. I don't see what value those numbers have.

What I thought would happen: I would call the input account materials and the output would be called inventory. Journal entries: 1)When purchasing: debit materials(input) credit Accounts Payable. 2)When manufacturing: debit Inventory(output) credit materials(input). 3) When selling: debit COGS credit Inventory(output). Now I know at any given time how much materials I have and how much inventory I have, but the system doesn't seem to work that way.

Check out http://ursainfosystems.com/homesite/webinar/ - there needs to be different input and output accounts for different kinds of products. Purchased v Manufactured.