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Printing & setup fees

Forum|Forum|2 years ago
March 15, 2024
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When purchasing inventory products, the invoice/receipt includes the printing setup fees, pad printing and shipping. Should those charges be added as the "cost of labor" or "other costs" when doing your taxes?

Best answer by Vanessa A

Pad printing and set up fees would be part of the inventory costs, allocated to each item that it applied to. So if the set up fee was $100, and you had 100 items, you would allocate $1 to each of the 100 items.

Shipping would be part of the inventory costs if it is inbound shipping. So if you paid $1,000 for 100 items and shipping was $100, then each item when you sold it would be $110 (depending on inventory method you used) When you sell the inventory, your shipping costs to the customer are separate and are considered shipping costs.

V

Vanessa AAnswer

Pad printing and set up fees would be part of the inventory costs, allocated to each item that it applied to. So if the set up fee was $100, and you had 100 items, you would allocate $1 to each of the 100 items.

Shipping would be part of the inventory costs if it is inbound shipping. So if you paid $1,000 for 100 items and shipping was $100, then each item when you sold it would be $110 (depending on inventory method you used) When you sell the inventory, your shipping costs to the customer are separate and are considered shipping costs.

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K

KB_GKAuthor

Understood, so no need to try to separate costs on the invoice. Thank you!!

V

Vanessa A

Correct. Assuming all items are the same and have the same value. If you have items of different values, then you would need to separate enough so that you can correctly value each item for when you sell it.

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