💰Income Statement Formulas
Cost of Goods Sold (COGS) - Merchandising
Beginning Inventory + Purchases - Ending Inventory = COGS
What It Means
What you paid for the stuff you actually sold.
Example
Beginning Inventory:$20,000
Purchases:$80,000
Ending Inventory:$25,000
$20,000 + $80,000 - $25,000
COGS = $75,000
Related Formulas
Net Sales
Gross Sales - Sales Returns - Sales Allowances - Sales Discounts = Net Sales
Cost of Goods Sold - Manufacturing
Beginning Finished Goods + Cost of Goods Manufactured - Ending Finished Goods = COGS
Gross Profit
Net Sales - Cost of Goods Sold = Gross Profit
Operating Income
Gross Profit - Operating Expenses = Operating Income
Want all 70+ formulas in one place?
← Back to Full Cheatsheet