The unit of measure you select here becomes the base unit and should be the smallest unit you use to track an item in QuickBooks.
Why should the base unit be the smallest unit?
QuickBooks uses the base unit to perform calculations, such as determining the price of an item with a related unit of measure. For example, suppose you select inch as the base unit of measure for the item named Copper Wire, which has a price of .03 per inch. Suppose you also define a related unit called foot, which contains 12 base units (inches). If you then add Copper Wire to an invoice with a quantity of one foot, QuickBooks calculates the price for you by multiplying the base unit (inch) price by 12 (.03 x 12 = .36).
If you don't make the base unit the smallest unit, defining smaller related units of measure can become more difficult and could require greater care. For example, if instead of using inch as the base unit you selected foot, then you'd have to define the inch related unit as containing .0833 feet, which is the approximate decimal value of 1/12.
Using a base unit larger than one or more related units could also result in slight inaccuracies caused by rounding. For example, the decimal number .0833 is a rounded number and is not exactly 1/12 of a foot. (The actual number never ends, because the 3 repeats indefinitely.) If you multiply .0833 by 12 you get 0.996 instead of the 1.0 that you would expect. In this case, calculations such as related unit costs and prices can be exactly accurate if the base unit is inch instead of foot, because a foot is exactly 12 times larger than an inch.
Note: If you're assigning a time-based unit of measure to a service item that you'll be using with QuickBooks time tracking, make sure you assign hour as the base unit. In weekly timesheets and timed single activities, time is always tracked in hours.
To do this task
Do one of the following:
Click one of the predefined base units of measure.
If the base unit you want to use is not listed, click Other.
Important: Whenever you create an inventory item, the cost, sales price, and quantity on hand information you enter is for the base unit. So make sure the base unit you create is the measurement by which you want to track cost, price, and quantity information.