I have a new client who sometimes gives away his inventory items as promotional items. I just wanted to make sure that this is being handled correctly - they have been taking the cost of the item from his cost of goods sold account and moving it to the promo expense account. Should I use the price he paid for the item originally or the price he could have potentially sold it for? If it is the price he purchased it for, this should not affect GST at all, correct?
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