Cost of goods sold
Cost of goods sold is an accounting term referring to the direct expenses related to creating and producing a product. Types of expenses that are considered "Cost of goods sold" include:
- The cost of product or raw materials, including the cost of having them shipped to you.
- The cost of storing the products you sell.
- Direct labor costs (including contributions to pensions or annuity plans) for workers who produce the products.
- Factory overhead expenses.