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What is Cost Of Goods Sold?

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Cost of goods sold (COGS) is an accounting term for the direct costs of products or services such as materials, labor, carrying costs and transportation. This appears on the income statement of an organization and is used to calculate gross margin. Only the costs of goods that were actually sold to a customer are reported on the income statement, together with the associated revenue from those sales.

COGS vs Cost of Revenue

COGS is essentially the same concept as Cost of Revenue. The latter is a more modern term that sprang out of the service industry. The term COGS is an older term that is associated with manufacturing. In many cases, businesses that sell services can directly relate marketing and selling costs to their unit sales. In manufacturing, these costs are traditionally seen as overhead.
Overview: Cost Of Goods Sold
Direct costs of products and services that have been sold in a given financial period.
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Business Costs

This is the complete list of articles we have written about business costs.
Applied Cost
Business Equipment
Capacity Cost
Capital Improvement
Carrying Costs
Closing Costs
Cost Of Capital
Cost Of Revenue
Cost Of Living
Direct Cost
Distress Cost
Fixed Costs
Friction Cost
Employee Costs
Holding Costs
Intangible Cost
Marginal Cost
Operating Cost
Operating Expenses
Legacy Costs
Outlay Cost
Lifetime Cost
Overhead Costs
Menu Costs
Relevant Cost
Normal Costs
Sunk Costs
Tangible Cost
Operational Costs
Travel Expenses
Unit Cost
Opportunity Cost
Variable Costs
Prospective Cost
Semi Variable Cost
Step Costs
Switching Costs
Transaction Costs
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