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How do I calculate the cost of goods sold for a manufacturing company?

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How do I calculate the cost of goods sold for a manufacturing company?
posted Aug 29, 2017 by Prajwal C.m.

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1 Answer

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The calculation of the cost of goods sold for a manufacturing company is: Beginning Finished Goods Inventory + Cost of Goods Manufactured = Finished Goods Available for Sale – Ending Finished Goods Inventory = Cost of Goods Sold.

The formula can be rearranged to read: Cost of Goods Manufactured +/- the change in Finished Goods Inventory = Cost of Goods Sold. If the Finished Goods Inventory decreased, then the amount of this decrease is added to the Cost of Goods Manufactured. If the Finished Goods Inventory increased, then the amount of this increase is deducted from the Cost of Goods Manufactured.

answer Sep 2, 2017 by Adarsh
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