To determine the cost of goods sold under a periodic inventory system, the following steps are necessary: 1.Determine the cost of goods on hand at the beginning of the accounting period. 2. Add to it the cost of goods purchased. 3. Subtract the cost of goods on hand at the end of the accounting period.
https://quizlet.com/20276200/ch-5-accounting-for-merchandising-operations-flash-cards/
The cost of goods sold is the cost of the merchandise that a retailer, distributor, or manufacturer has sold. The cost of goods sold is reported on the income statement and can be considered as an expense of the accounting period. By matching the cost of the goods sold with the revenues from the goods sold, the matching principle of accounting is achieved. The sales revenues minus the cost of goods sold is gross profit.
https://www.accountingcoach.com/blog/cost-of-goods-sold-2
The following is an excerpt from Accounting Made Simple: Accounting Explained in 100 Pages or Less. When using the periodic method of inventory, Cost of Goods Sold is calculated using the following equation: Beginning Inventory + Inventory Purchases – End Inventory = Cost of Goods Sold. This equation makes perfect sense when you look at it piece by piece.
http://obliviousinvestor.com/how-to-calculate-cost-of-goods-sold-cogs/
Cost of Goods Sold and The Income Statement for Manufacturing Companies. Manufacturing companies are companies that make a product. Because these companies have inventory in various stages of production, there are three inventory accounts that we must deal with in order to calculate cost of goods sold. The three inventory accounts are: Raw materials inventory. Work-in-progress inventory.
http://accountinginfocus.com/managerial-accounting-2/introduction-managerial-accounting-2/cost-of-goods-sold-and-the-income-statement-for-manufacturing-companies/
The first section of the income statement for a trading business describes the core activities of a trading business, i.e. the buying and selling: Sales: Sales are the full income for the year for selling goods. Cost of goods sold: This refers to the cost of all the goods that we sold this year.
http://www.accounting-basics-for-students.com/cost-of-goods-sold.html
Beginning inventory, plus the amount of inventory purchased over the period gives you the total amount of inventory that could have been sold (sometimes known, understandably, as Cost of Goods Available for Sale). We then assume that, if an item isn’t in inventory at the end of the period, it must have been sold.
http://obliviousinvestor.com/how-to-calculate-cost-of-goods-sold-cogs/
So our sales would be $400 and our cost of the goods we sold (cost of sales) would amount to $300. This would result in a gross profit of $100 (sales minus cost of sales). Cost of goods sold is not the same as purchases, as you will see from our examples below.
http://www.accounting-basics-for-students.com/cost-of-goods-sold.html
Periodic inventory system. An inventory system under which the company does not keep detailed inventory records throughout the accounting period but determines the cost of goods sold only at the end of an accounting period.
https://quizlet.com/20276200/ch-5-accounting-for-merchandising-operations-flash-cards/
To determine the cost of goods sold under a periodic inventory system, the following steps are necessary: 1.Determine the cost of goods on hand at the beginning of the accounting period. 2. Subtract the cost of goods on hand at the end of the accounting period.
https://quizlet.com/20276200/ch-5-accounting-for-merchandising-operations-flash-cards/
It is also known as cost of sales. Cost of goods sold is an expense charged against sales to work out a gross profit (see definition below). So, for example, we may have sold 100 units this year at $4 each, and these 100 units that we sold cost us $3 each originally.
http://www.accounting-basics-for-students.com/cost-of-goods-sold.html
what statement is cost of goods sold account
An income is cost of goods sold account.