===== How does Offtoa calculate cost of goods sold (COGS)? =====

When purchased, the value of raw materials are entered into inventory (which appears on your balance sheet). When a product is sold, the part of inventory that was used to create your product is transferred from inventory to cost of goods sold.

{{keywords>cost of goods sold, COGS, production days, inventory days, inventory, balance sheet, income statement, raw materials, purchasing}}

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