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Products purchased for resale go to inventory.

So if you buy products that are used for promotions these are expensed when purchased. 

I am not sure what " cash and carry" means.

Inventory and Cost of Goods Sold (COGS) is set up like this.

Beginning inventory   $100  Goods on hand 1/1/2016

Purchases    $2,000  items purchased for resale to customers

Ending inventory  $300  what was on hand on 12/31/2016.

COGS  $1,800 gets applied in TurboTax against the sales. 

So if you buy something for giveaways and promotions, it does not go under purchases but it is a direct expense item.  

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