Cost of goods sold

Question

Cost of goods sold

Quizplus · Accepted Answer

Cost of goods sold appears on both manufacturing and merchandising companies' income statements as it represents the cost of the products sold by the company. However, the calculation of Cost of goods sold differs between manufacturing and merchandising companies as manufacturing companies have to include the cost of direct materials, direct labor, and manufacturing overhead, while merchandising companies only include the cost of purchasing or producing the products they sell.

Cost of Goods Sold