If I have a company that rents bridal accessories, should I be putting the inventory as COGS or depreciating over time? Or can I do both?

[MichaelL1 · Accepted solution]

COGS is for items that are sold to customers in the normal course of business.

Rental of bridal should not be in COGS.  

The items if the material in cost should be depreciated over the useful life.  You cannot do both as no double benefit is allowed.

I do realize you may sell some of the used rentals later but that is not the bread and butter of the business. 

[brittfinkle]

Super helpful - thank you!  And where do I show depreciation on a schedule C? Or is there a different form for depreciation of assets?

[MichaelL1]

In the Sch C area it will ask about assets that were acquired during the year and then allow depreciation and/or faster write-off the outfits.