--%>
Assignment Help - homework help

Explain Cost of goods

Explain Cost of goods and how they are used in estimating gross profit and net profit of the business?

E

Expert

Verified

Cost of goods sold comprises total cost of opening stock and purchase. When company has incurred certain expenses on purchasing of goods then such expenses are as well comprised in buying goods cost. When there is any closing stock, we can just subtract from above total cost. After this, we can acquire the cost of goods sold. This amount is very significant since devoid of this, we can’t estimate gross profit and net profit of the business.

Cost of goods sold = Opening stock + Net purchase + Direct expenses - closing stock

   Related Questions in Financial Accounting

  • Q : Political events affecting the local

    Discuss about the different ways in which the political events in the host country affects the local operations of MNC.

    		•
  • Q : Case study of gene expression analysis

    The paper by Golub et al. that was the focus of the second part of the BioConductor practical was the first analysis of its kind, demonstrating that gene expression analysis could potentially be used to classify leukaemia sub-types. Since its publication in 1999 there

    		•
  • Q : Guidelines for effective communication

    Define and explain the four guidelines for effective communication in families. Give examples to describe each guideline.

    		•
  • Q : Cause and Solution to international

    Discuss briefly the cause and the solution(s) to international bank crisis including less developed countries.

    		•
  • Q : Abnormal profits Atypically large

      Atypically large proceeds made by an individual or company from commercial activity. An abnormal profit exceeds the normal chance for profit derived from labor costs and capital and considered normal profit. Abnormal profit in a business resides of monopoly and consortium profits.

    		•
  • Q : Lessons from experiences of Novo State

    State some of the factors which motivated Novo Industries to seek the U.S. listing of its stock. Explain about the lessons which may be derived from experiences of Novo?

    		•
  • Q : Case study of an economic and labour

    The woman in the dark suit (serious women always wear black suits) leafed through the papers on her desk. She was a fund manager and she was nearing the deadline for an investment decision by one of her leading clients, who wanted to invest in sovereign bonds in a dev

    		•
  • Q : MONEY MEASUREMENT CONCEPT DESCRIBE THE

    DESCRIBE THE ADVANTAGES AND DISADVANTAGES OF MONEY MEASUREMENT CONCEPT

    		•
  • Q : Currency options and forward contract

    State some of the advantages of currency options contract as a hedging tool as compared with the forward contract?

    		•
  • Q : Determining interest rate parity

    Presently, spot exchange rate is $1.50/£ and three-month forward exchange rate is $1.52/£. Three-month interest rate is 8.0% per annum within the U.S. and 5.8% per annum within the U.K. Suppose that you can borrow as much as $1,500,000 or £1,000,000.

    		•