Difference between revisions of "Account for Cost of Goods Sold"

The cost of goods sold (COGS) for a period is the total amount of costs involved in manufacturing a product or delivering a service.  COGS varies for products and services, but it generally includes labor, materials and overhead.  On your company’s income statement, the COGS is subtracted from the total revenues to calculate the gross profit margin.  In broad terms, you calculate COGS by determining the amount of inventory used in the period.  This assumes that the inventory used in that period was used to produce what was sold in the same period.<ref name="rf1"> http://www.accountingtools.com/definition-cost-of-goods-sold</ref>

The cost of goods sold (COGS) for a period is the total amount of costs involved in manufacturing a product or delivering a service.  COGS varies for products and services, but it generally includes labor, materials and overhead.  On your company’s income statement, the COGS is subtracted from the total revenues to calculate the gross profit margin.  In broad terms, you calculate COGS by determining the amount of inventory used in the period.  This assumes that the inventory used in that period was used to produce what was sold in the same period.<ref name="rf1"> http://www.accountingtools.com/definition-cost-of-goods-sold</ref>

== Steps ==

== Steps ==

===Calculating Beginning Inventory, Costs and Purchases===  

===Calculating Beginning Inventory, Costs and Purchases===