article thumbnail

What is COGS in Accounting and How to Calculate It?

Snyder

According to the cost of goods sold definition, this metric includes the cost of the materials and labor directly used to create the product and excludes indirect expenses like distribution and sales force costs. Cost of goods sold is sometimes called “ cost of sales.” ” COGS is also an accounting term under U.S.

article thumbnail

FAQs Business Owners Need to Know About The 3 Essential Financial Reports

inDinero Accounting

If a business owner doesn’t understand an accounting term , we don’t use another accounting term to explain it. We specialize in accountants who speak business to business owners and CEOs. Sometimes there’s just no avoiding accounting speak. GROSS PROFIT = NET SALES – COST OF GOODS SOLD.