An In Kind transaction is entered by adding a new transaction either from the Transaction or Constituents Grid or from within the constituent's record under their Transaction Tab. 

From the transaction entry screen, select the type In Kind. You may assign a dollar value to the transaction or leave it as zero depending on the accounting practices your organization has chosen to adopt. If the In Kind donation is to be used as an auction item, switch the Potential Auction Item? button to YES. You can enter the information about the auction item now, or edit it later.

Please see How do I add a transaction? for more information.