What is included in Cost of goods sold (COGS)?



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In the 3rd video on Gross Margin, it was explained that COGS includes only ingredients however as per Cost Sheet, COGS includes every expenditure directly or indirectly related to the product manufactured. Please clarify

5 Answer(s)


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In the case of Dominos the COGS were ingredients. That differs from industry to industry. Any direct cost is always in COGS. Indirect costs like salary, software costs etc are typically decided on a case by case basis based on company.

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It depends according to the industry like in this video they talked about Dominos Pizza company, where ingredients are main COGS. because ingredients are the direct costs & Direct cost is only include in the COGS.

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this depends on industries u are looking at. for manufacturing ,production ,IT,banking cost of goods is diffrent in diffrent cases. for steel we used coal ,sinter, coke ,flux,iron ore as goods.these cost are included in our COG.

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COGS differs from industry to industry.Such as in factory, wages is COGS where as salary is treated as operating expense

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cogs stannds for cost od goods sold and in dominos it will go for the substances used in making pizza

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