Cost Of Sales

Cost of sales measures the cost of goods produced or services provided in a period by an entity. It includes the cost of the direct materials used in producing the goods, direct labor costs used to produce the goods, and any other direct costs associated with producing goods. Examples of what can be listed as COGS include the cost of materials, labor, and wholesale price of goods resold, such as in grocery stores, overhead, and storage. Any business supplies not used directly for manufacturing a product are not included in COGS.