In a woodworking business, would things like sandpaper and rags for wiping stains be considered Cost of Goods?

Matt W asked:


I do the accounting for a woodworking business. I understand that materials such as wood and paint and the factory labor are costs of good sold. I am also pretty sure that the factory machinery and tools that we use are not necessarily costs of goods sold. For me, the gray area is the little things like sandpaper and the rags that we use to wipe on the stains. We go through a lot of these and it’s a pretty big expense. I just want to make sure they are accounted for correctly.
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