More debate, awesome!
If this business owner pays an outside contractor to train the dogs they purchased for resale and the dogs cannot be sold without training because they are being sold as service dogs that have been trained to be service dogs, then in theory, the training would be a Cost of Goods Sold expense when the service dog is sold.
The original post noted that the business owner "purchased" training and equipment for the dogs. Although, in retrospect he referred to the dogs as "protection dogs", which is slightly different than "service dogs", so in all we don't have enough actual detail to determine how we as Accountants would record the accounting transactions. We only know that purchases made that are necessary to sell something can be considered a COGS type expense when they are sold.
