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- The key differences between supplies and materials are12:
- Supplies include items such as paper, ink, pens, pencils, and notepads used in basic operation.
- Materials are typically raw materials used in the production of goods for resale.
- Supplies are treated as expenses, while materials are treated as assets.
- The cost of supplies can be deducted in the year of purchase, while materials are treated as an asset until sold.
- Supplies are typically claimable only within the year of purchase, while materials are always added to your inventory instantly when purchased.
Learn more:✕This summary was generated using AI based on multiple online sources. To view the original source information, use the "Learn more" links.Accurately recording purchased items used in the operation of a business as either supplies or materials is important for accounting purposes. Supplies include paper, ink, pens, pencils and notepads used in basic operation. The term "materials" is typically used to designated raw materials used in the production of goods for resale.
smallbusiness.chron.com/difference-between-suppl…In summary, the key differences between a supply and a material are:
- Supplies are treated as expenses, while materials are treated as assets.
- You can deduct the cost of your supplies in the year that you purchase them.
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