Business

How to Calculate Cost of Goods Sold for Financial Statements

Written by the MasterClass staff

Last updated: Feb 25, 2022 • 3 min read

Small businesses and larger companies alike should familiarize themselves with the cost of goods sold (COGS), which determines gross profit and tax write-offs. Understanding both the factors and the formula to calculate COGS) can help you visualize your profit and production cost margins.