By Leanna Kelly Businesses seek to generate profit. To do this, they sell goods to bring in revenue. But revenue and profit aren’t the same. To get from one to the other, you need to factor in the cost of goods sold (COGS). COGS represent the amount of direct material, direct labor and overhead used to produce goods sold by a business. In short: the cost subtracted from sales revenue to get a gross profit figure.
COGS is sometimes referred to as “the cost of sales” because it represents the upfront investment needed to produce a saleable product. The important thing to remember …read more
