This will show you how to add a department to an existing Stock Location. To create a new Stock Location, see: Creating a New Stock Location in Inventory.
1. Go to [Inventory] → [Stock Locations].
2. Find the location you want to update and click the [Edit] button next to the location name.
3. In the pop-up window, the 2nd field is the part where you can select the department. You can type the department name, or you can choose from the dropdown that will appear once you click in the field.
4. You may also assign the default account, if applicable. Once this is done, just click the [Update] button in the pop-up and the changes you've made will be saved.
There, the department has now been updated/added to your stock location.