A cost of goods sold statement shows the cost of goods sold over a specific accounting period, typically offering more insights than are found on a normal income statement. John Manufacturing Company, a manufacturer of soda bottles, had the following inventory balances at the beginning and end of 2018: The cost of goods manufactured statement is shown as follows: Here is the link to the Cost of Goods Sold Statement MCQs.
Example
In 2018, the company purchased $1,000,000 of raw materials, and direct labor incurred a cost of $1,600,000. Manufacturing overheads were as follows:
Sales revenue was $4,105,000 for the year. Selling and administrative expenses for the year amounted to $110,000.Required
Solution
Preparation of cost of goods sold statement:
Now that you have learned how to prepare the Cost of Goods Sold Statement, would you like to check your knowledge of the COGS Statement by taking the MCQs we have prepared for you?
Cost of Goods Sold Statement FAQs
A cost of goods sold statement shows the cost of goods sold over a specific accounting period, typically offering more insights than are found on a normal income statement.
The things which are manufactured for selling purpose or bought for reselling purpose are known as goods or merchandise.
First, prepare a cost of goods manufactured statement. Then, prepare a cost of goods sold statement.
Cost of goods manufactured is the total cost incurred by a manufacturing company to manufacture products during a particular period.
The cost of goods sold, or cogs, refers to any direct cost associated with the production of a product. This includes materials, direct labor, machinery, and manufacturing overhead.
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