Cost of Goods Sold (COGS) Calculator
Calculate your Cost of Goods Sold to determine the direct costs of producing your products. This essential metric helps you understand your gross profit margin.
Results
Cost of Goods Sold:
$0.00
Enter your inventory values to calculate COGS.
How to Use This Calculator
- Enter your beginning inventory value (at start of period)
- Enter additional inventory purchases during the period
- Enter your ending inventory value (at end of period)
- Click “Calculate COGS” to see your results
COGS Formula
COGS = Beginning Inventory + Purchases – Ending Inventory
Why COGS Matters
- Determines your gross profit when subtracted from revenue
- Helps calculate inventory turnover ratio
- Essential for accurate financial reporting
- Impacts your taxable income
Tips to Optimize COGS
- Negotiate better prices with suppliers
- Improve inventory management to reduce waste
- Streamline production processes
- Consider bulk purchasing discounts
- Regularly review and adjust pricing strategy