@Gahvac
You aren't missing anything. If you buy a furnace for $3,500 and assign it to COGS and bill your customer for $3,500 and assign that to revenue (gross income), your P&L will show $3,500 in revenue and -$3,500 in COGS resulting in $0 of net (taxable) income. The only issue is if you're assigning the bill for the furnace to an account other than an expense account of COGS or you're marking up the furnace. Both of those will cause your net (taxable) income to increase.