Frequently Asked Questions(FAQ)

Is cost of goods sold an asset or liability?

Cost of goods sold is neither an asset nor a liability. An asset is what a business owns and a liability is what a business owes. COGS, rather, is a type of expense.

What’s the difference between inventory and COGS?

Inventory refers to the products you have that are available to be sold. Cost of goods sold, on the other hand, refers to the direct costs that are associated with producing those goods.

Are salaries included in COGS?

No, salaries are not included in COGS because they are not direct costs related to producing a good or service. Costs that aren’t included in COGS include marketing, salaries, and transportation.

Is there a template available to help calculate COGS?

About the Authors

Michael Shelby

Written by: Michael Shelby

Banking Manager/Freelance Writer

Michael Shelby is an experienced banking manager with a strong tax and personal finance background. He is passionate about sharing his knowledge and expertise with others and has recently embarked on a journey to become an author writing for blogs.

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