An income statement with cost of goods sold (COGS) is a financial report that shows a company’s revenues, expenses and profit over a specific period. This document allows an organization to compare its total sales (revenues minus COGS) to its operating expenses in order to determine how much it needs to spend over a given period of time. By analyzing this information, businesses can make better decisions about how to allocate their resources and optimize efficiency. In addition, COGS helps organizations evaluate the effectiveness of their pricing strategies and identify potential areas for cost savings.