COGS Calculator – Cost of Goods Sold & Inventory

Cost of Goods Sold (COGS) Calculator

Calculate COGS from starting inventory, net purchases, direct labor, and ending inventory.

Overview

Calculates Cost of Goods Sold (COGS) from beginning inventory, direct raw material purchases, factory labor, and ending inventory balances.

COGS = Beginning Inventory + Net Purchases + Direct Labor & Manufacturing - Ending Inventory

Represents the direct costs attributable to the production of goods sold in a company during an accounting period.

Inputs: Starting Inventory = ₹4,00,000 | Purchases = ₹12,00,000 | Direct Labor = ₹3,00,000 | Ending Inventory = ₹5,00,000

Cost of goods available for sale = ₹4,00,000 + ₹12,00,000 + ₹3,00,000 = ₹19,00,000
Subtract closing physical inventory = ₹19,00,000 - ₹5,00,000 = ₹14,00,000

Summary: Beginning Inventory = ₹4.0 Lakhs | Purchases = ₹12.0 Lakhs | Ending = ₹5.0 Lakhs | COGS = ₹14.0 Lakhs

Gross Profit Calculation: Subtract COGS from gross revenue to determine production profitability.
Inventory Valuation Audit: Reconcile physical warehouse stock counts with balance sheet accounting records.
Tax Return Preparation: Report accurate cost of goods sold on corporate income tax return schedules.

Raw materials, factory worker direct labor, inbound freight shipping, packaging, and manufacturing plant electricity.

Office salaries, executive compensation, advertising, legal fees, accounting, and sales commissions.

A higher ending inventory reduces COGS, which increases reported gross profit for that financial period.

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