When trying to create an Invoice for a Sales Order in which the Sales Order contains a non-inventoried item, labor item or shipping item, you may receive this message:
Invoice not released
Non-inventoried Cost Offset account for (Some Warehouse) is not set, Order ‘SomeOrderNumber’, Line Number ‘X’ (SomeProduct)
This error prevents creating an invoice and occurs when a product on the order has a Non-inventory item type using the Standard cost method without configuring the non-inventoried warehouse GL accounts. Generally, an item is set up this way to track internal costs for a non-inventoried or labor item. Learn more about this product set up.
The error will tell you the warehouse account, warehouse, order line number and product ID that need attention.
The non-inventoried warehouse accounts can be set up by opening File > Configuration Manager > Inventory > Warehouse. Select the related Warehouse, then select the Non-Inventoried tab in the Warehouse Accounts section at the bottom of the record. Use the look up to choose a GL account for the account referenced by the error.
After saving and closing Configuration Manager, you should be able to properly create your Invoice now.