@LarryKetch
This is a great question. Is the demoed concrete crushed and then held onto for a while or is it crushed as needed? Are the expenses and related income immaterial to the business? Are you asking this question because you want to be able to measure the profitability of selling crushed concrete or for another reason?
If the concrete is crushed and then sits for a period of time, technically, the costs should be capitalized into inventory and then expensed when sold. As an accounting teacher, you probably recognize this as the matching principle. If the concrete is crushed as needed, then the expenses may match the period in which the revenue occurs. If that's the case, capitalizing the costs into inventory is unnecessary as the expenses and related revenues match. From a tax perspective, the concern is that you will be expensing the processing of the concrete prior to receiving the revenues from selling it, thereby taking tax deductions prematurely.
If the costs are immaterial to the business, then there is no need to capitalize the costs into inventory and you can just record the expenses and related revenue as they occur. This may be the case since you mentioned the company doesn't do this on a regular basis.
If your desire is to more accurately track the profitability, then it makes sense to capitalize the costs into inventory so you can see the revenue and related expense for the period when you run your reports. Obviously, there are costs associated with your time to track the expenses and make adjusting entries to capitalize those costs into inventory.
