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cost of goods sold
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cost of goods sold

finance
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Cost of goods sold (COGS) represents the direct costs attributable to the production or purchase of the goods sold by a company during a specific period. This includes the purchase cost for retailers and the production cost for manufacturers. COGS is a crucial component in calculating a company's gross profit, which is the revenue remaining after deducting COGS.12

There are different methods for calculating COGS, such as first-in, first-out (FIFO) and last-in, first-out (LIFO), which impact the reported cost of goods sold and the value of ending inventory. Understanding COGS is essential for assessing a business's financial health and profitability.32

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3 Britannica Sources
  1. cost of sales
  2. Gross, operating, and net profit margins: Why they matter (and how to use them)
  3. accounting - Cost of goods sold

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