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Cost of Goods Sold - COGS
What does it mean?
A figure reflecting the cost of the product or good that a company sells to generate revenue, appearing on the income statement as an expense unto itself. Also referred to as "cost of sales."
In Other Words...
It is essentially a cost of doing business, such as the amount paid to purchase raw materials in order to manufacture them into finished goods. For example, if a $10 widget costs $6 to make, then your COGS is $6 per widget.
Related Links
Introduction to Fundamental Analysis - Here's an easy-to-understand tutorial on the techniques of analyzing a company's financial statements, including the annual and quarterly reports, the auditor's report, and much more.
Related Terms
Burn Rate | Cash Flow Per Share | Cash Flow Return on Investment (CFROI) | Discounted Cash Flow (DCF) | Net Income
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