MANAGEMENT

Detailed explanation-1: -COGS = Beginning inventory + purchases + Freight In – Ending inventory – Purchase Discounts – Purchase Returns and Allowances.

Detailed explanation-2: -Gross profit will appear on a company’s income statement and can be calculated by subtracting the cost of goods sold (COGS) from revenue (sales). These figures can be found on a company’s income statement. Gross profit may also be referred to as sales profit or gross income.

Detailed explanation-3: -The cost of goods purchased is the net cost of merchandise acquired. The calculation is to add freight in to the initial purchase cost and then subtract purchase allowances, purchase discounts, and purchase returns.