cogs acronym

cogs acronym stands for “Cost of Goods Sold.” This term refers to the direct costs associated with the production of goods that a company sells during a specific period. COGS includes expenses such as raw materials, labor, and manufacturing overhead, which are incurred in the production of a product. Understanding COGS is critical for businesses as it helps in determining gross profit by subtracting the COGS from total revenue. Accurate tracking of COGS is essential for financial reporting, pricing strategies, and managing profitability in industries like retail, manufacturing, and e-commerce.