Expenses ect

[sk9]

Anyone know if you are doing a building job for a customer, what category are the materials and tools used in the job are categorized as,? are they expenses or costs of sales or billable expense or something else?

Thank you

 

[Scalloway]

If they are not going to be separately identified on the bill then I would just put them to cost of sales.

 

[sk9]

Ok, I thort a "cost of sales" was a item you buy and sell on to the customer.
Im just trying to categorize my transactions on my accounting software

Would the materials and small tools used to complete the job be a cost of sale. (ie: say if you paint a house, would the paint used be a "cost of sale" and not an expense


thanks

 

[Scalloway]

I would catergorise everything that goes into a building job as a cost of sale. You need to cover them in your price to make a profit.

Expenses are those things that are necessary for running the business but are not directly attributable to sales. Things like telephone, insurance, advertising, bank charges etc.

 

[paulears]

Paint brushes, tape, a new ladder because the old one wasn't long enough, turps, gloves, paint charts are one category, and the consumable items like the paint is being in effect, sold on. Your expenses for the job are going to be fuel getting there, possibly food and maybe hotel charges, cleaning of any clothing that gets dirtied. In fact, I complicate it sometimes by recharging some of what would have been normal expenses to the client, if I can.