I make bath & body products and carry an inventory that includes my ingredients & products I made but have not sold. I entered my beginning inventory and ending inventory. My question is regarding the next page which list cost of purchases, material and supplies, and other costs to prepare for sales. I am confused what these 3 represent. I have my receipts for the year that I purchased for the following reasons:
Ingredient that become the product (example: oils, butters, fragrances etc.)
Jars, bottles, labels (product packaging)
Boxes, bubble mailers etc. (for shipping)
Which one of the above expenses goes on the line for cost of purchases, material and supplies and other costs to prepare for sales?
If someone can please answer my question and help me understand where I am to report each individual purchase expense, I would be grateful.
Thanks, in advance!