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Cost of Goods Sold (COGS) Calculated by Periodic Method of Inventory

Cost of Goods Sold (COGS) Calculated by Periodic Method of Inventory
   
Home  » Products  » VIP Task Manager Pro  » Tutorials  » Customization Guide  » Cost of Goods Sold (COGS) Calculated by Periodic Method of Inventory

Cost of Goods Sold (COGS) Calculated by Periodic Method of Inventory

    Cost of Goods Sold (COGS) is general accounting KPI that shows the total amount of direct expenses tied to the production of goods or services sold by the company. Cost of Goods Sold includes the costs of the materials, labor costs and overhead expenses to produce goods. COGS exclude any indirect expenses: Selling, General, and Administrative Expenses (SG&A expenses) such as distribution costs, salaries, marketing, etc. There are several ways to calculate Cost of Goods Sold. One of the basic methods is periodic method of inventory. According to it COGS can be calculated by the following formula:

    Cost of Goods Sold = Beginning Inventory + Inventory Purchases End Inventory

    Beginning Inventory is the amount of inventory available for use or sale at the beginning of an accounting period.

    Inventory Purchases is the total amount of purchases made over some period of time. Beginning Inventory plus Inventory Purchases is Cost of Goods Available for Sale, i.e. The total amount of inventory that can be sold.

    End Inventory is the amount of inventory available for use or sale in the end of an accounting period.

    So Cost of Goods Sold KPI is used to estimate the cost of turning raw materials into production to sell goods.

    If you need to calculate Cost of Goods Sold, please follow the steps below:

  • Add custom field "Beginning Inventory":
  • Add custom field "Inventory Purchases":
  • Add custom field "End Inventory":
  • Add custom field "Cost of Goods Sold (COGS)":
  • On Task Tree select task group for which you need to display Cost of Goods Sold and select "Custom fields options"
  • Select custom fields "Beginning Inventory", "Inventory Purchases" and "End Inventory" and set the following settings for these custom fields:
    • In "Settings for" select "This task group"
    • select "Enable"
    • in "Aggregated (for task group)" field select "Sum" from drop-down list and the corresponding custom field name:
  • Select custom field "COGS" and set the following settings:
    • In "Settings for" select "This task group"
    • select "Enable"
    • select "Calculated by custom field formula (for task group)"
  • Cost of Goods Sold (GOGS) on Task Tree


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