A company sells travel mugs online for $9. They purchase the mugs for $3 and charge the customers $1 for shipping and handling. Cost of goods sold per mug is:
A) $0.
B) $1.
C) $3.
D) $9.

Question

Quizplus · Accepted Answer

Cost of goods sold (COGS) refers to the expenses a company incurs to produce the products it sells. In this case, the travel mugs are purchased for $3, which is the COGS per mug. The shipping and handling fee is not included in COGS, as it is a separate expense charged to the customer. Therefore, the cost of goods sold per mug is $3.

A Company Sells Travel Mugs Online for $9