Cost of Goods Sold Statement

In the published financial statements, the cost of goods sold is generally shown as a single figure in the income statement and is elaborated a little bit in the notes to the financial statements. However, for internal uses, some additional information such as material cost, labor cost, overheads etc. is essential for planning the future activities and evaluating the past performance. The following format will be helpful for preparing the cost of goods sold statement:

XYZ Company
Cost of Goods Sold Statement
For the Period Ended ________

—-Amount in $—-
 Direct material cost
 Opening inventory 10,000
Purchase during the period 80,000
Materials available for use 90,000
Less: closing inventory (5,000)
Materials consumed 85,000
Direct labor cost 55,000
Factory overheads
Indirect labor 12,000
Power 6,000
Heat 1,500
Light 4,000
Factory supplies 500
Depreciation – factory building 1,200
Depreciation – machinery 1,000
Total factory overheads 26,200
Total manufacturing cost 166,200
Add: Work in process opening inventory 5,000
Less: Work in process closing inventory (3,500)
Cost of goods manufactured 167,700
Add: Finished goods opening inventory 8,000
Less: Finished goods closing inventory (3,200)
Cost of goods sold 172,500