COGS Calculator
Free COGS calculator. Calculate Cost of Goods Sold with full component breakdown. Essential for manufacturing, retail, and e-commerce businesses to track production costs.
About This Calculator
Cost of Goods Sold (COGS) is a fundamental metric for any business that sells physical products or manufactures goods. Our calculator breaks down COGS into its components: beginning inventory, purchases, direct labor, direct materials, manufacturing overhead, and ending inventory.
Accurate COGS calculation is essential for determining gross profit, setting prices, filing taxes, and understanding your business's production efficiency.
Frequently Asked Questions
What is COGS?
COGS represents direct costs attributable to producing goods sold. COGS = Beginning Inventory + Purchases + Direct Labor + Direct Materials + Overhead - Ending Inventory.
What is included in COGS?
Direct costs: raw materials, direct labor, manufacturing overhead, freight-in, import duties. Excludes marketing, sales, admin salaries.
How to calculate COGS?
COGS = Beginning Inventory + Purchases + Direct Labor + Direct Materials + Overhead - Ending Inventory.
What is the difference between COGS and operating expenses?
COGS are direct production costs. Operating expenses are indirect costs like rent, marketing, admin salaries.
How does COGS affect gross profit?
Gross Profit = Revenue - COGS. Lower COGS means higher gross profit.
What is the formula for COGS percentage?
COGS % = (COGS / Revenue) x 100. Lower percentage means higher gross margins.