Variable Cost of Goods Sold (VCOGS) is an accounting term used to identify the fluctuating costs associated with producing and selling goods. These costs typically rise and fall depending on the volume of production, inventory levels and other factors. When businesses track VCOGS, they can accurately account for their total costs and produce financial reports that reliably reflect their profitability. In a world where staying ahead of the competition means understanding your business through data, Variable Cost of Goods Sold plays an important role in managing costs, as well as making informed decisions that help keep you within budget.