[xibadx]

Can someone please explain the differences in these?

All passed on first try - Licensed CPA Texas
Studying tip: Study throughout the day (short intervals, no more than 3hrs/day total), take exam later in the day and cram before your exam.

[MCLKT]

Cost of goods sold is the value of inventory out the door. Beg. Inventory + Purchases – Ending inventory = COGS

Cost of goods manufactured is the expense in creating goods to sell. These are Direct Materials, Direct Labor (manufacturing employee salary), and Overhead allocated to manufacturing goods.

DM, DL, and OH are Manufacturing costs. They will carry a debit balance. And as you allocate costs (cost accounting) you will Credit the manufacturing cost account, and Debit cost of goods manufactured.

A:[73]97 F:[74]85 R:86 B:[74]82
*NINJA 10 Pt. COMBO & Yaeger*

[Author]

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