My client was having the same issue, but they do not use Inventory. All Products/Services are Non-Inventory item types. The items are mapped to the correct income account (and do not have an expense account mapped for the purchase of these items). Yet, still, the invoice amounts are showing up in COGS.
I finally figured out that this was caused by their having “Track quantity and price/rate” turned ON in their Account Settings for Products and Services. Turning that feature off solved the issue.
Just wanted to add this in case others are in the same situation. Happy number-crunching!
