Calculate Cost Of Goods Sold Definition

To calculate your cost of goods sold, you’ll need to know the following:

– The total cost of inventory on hand at the beginning of the period

– The total cost of inventory purchased during the period

– The total cost of inventory on hand at the end of the period

Add up the cost of all the inventory you had on hand at the beginning of the period. Then add in the total cost of any inventory you purchased during that period. Finally, subtract out any inventory remaining at the end of the period. This final figure is your cost of goods sold for that accounting period.