I’m new to this and not an accountant- there for I’d like to know what the difference is between the above - maybe simple to some - but not to others like me and would like some help for entering some of my misc items.
Thanks
“Misc purchases” sits in the “purchases” section (5xxx codes) which means it is part of your cost of sales. Typically that means things where there’s an identifiable link between a particular purchase and one or more specific sales - “the more you sell, the more you need to buy”. Anything you put onto misc purchases will be deducted from your turnover to calculate your gross profit.
“Misc expenses” sits in the “expenses” section (codes 6000 upwards), which is for general costs of doing business that are not directly related to how much “stuff” you sell. Staff costs, rent, utilities, stationery, etc. etc. Anything you put onto misc expenses will be deducted from your gross profit to calculate your net profit.
Sometimes it’s obvious which category a particular cost falls into, sometimes it’s more debatable.
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Ok thanks - I do have some glasses for purely computer work that are left in the office - what nominal code would I put these to please?
That would be an expense.
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