Accounting Cost of Goods Sold Calculator Examples
See worked COGS examples for retail, wholesale, and seasonal inventory periods.
These examples show how beginning inventory, adjusted purchases, freight-in, and ending inventory work together in a periodic cost of goods sold calculation. Amounts are illustrative estimates, not financial reporting guidance.
Small retailer with purchase discounts
Retail store monthly inventory calculation
Input Summary
Beginning inventory
$12,000
Inventory purchases
$36,000
Purchase returns and discounts
$1,200
Freight-in
$800
Ending inventory
$10,500
Calculation Breakdown
- 1Net purchases$36,000 - $1,200 + $800$35,600
- 2Goods available for sale$12,000 + $35,600$47,600
- 3Cost of goods sold$47,600 - $10,500$37,100
Result Summary
Cost of goods sold
$37,100
Accounting Cost of Goods Sold Calculator
Estimated monthly COGS is $37,100.
Wholesale distributor with a large ending balance
Wholesale distributor quarterly inventory calculation
Input Summary
Beginning inventory
$90,000
Inventory purchases
$220,000
Purchase returns and discounts
$8,000
Freight-in
$12,000
Ending inventory
$115,000
Calculation Breakdown
- 1Net purchases$220,000 - $8,000 + $12,000$224,000
- 2Goods available for sale$90,000 + $224,000$314,000
- 3Cost of goods sold$314,000 - $115,000$199,000
Result Summary
Cost of goods sold
$199,000
Accounting Cost of Goods Sold Calculator
Estimated quarterly COGS is $199,000.
E-commerce business with no purchase adjustments
E-commerce business monthly inventory calculation
Input Summary
Beginning inventory
$18,500
Inventory purchases
$54,000
Purchase returns and discounts
$0
Freight-in
$3,500
Ending inventory
$22,000
Calculation Breakdown
- 1Net purchases$54,000 - $0 + $3,500$57,500
- 2Goods available for sale$18,500 + $57,500$76,000
- 3Cost of goods sold$76,000 - $22,000$54,000
Result Summary
Cost of goods sold
$54,000
Accounting Cost of Goods Sold Calculator
Estimated monthly COGS is $54,000.
Seasonal business building inventory
Seasonal business pre-season inventory calculation
Input Summary
Beginning inventory
$40,000
Inventory purchases
$100,000
Purchase returns and discounts
$5,000
Freight-in
$5,000
Ending inventory
$85,000
Calculation Breakdown
- 1Net purchases$100,000 - $5,000 + $5,000$100,000
- 2Goods available for sale$40,000 + $100,000$140,000
- 3Cost of goods sold$140,000 - $85,000$55,000
Result Summary
Cost of goods sold
$55,000
Accounting Cost of Goods Sold Calculator
Estimated period COGS is $55,000.
How to Read Your Results
Net purchases show the purchase cost after adjustments and direct inbound acquisition costs.
Goods available for sale is an intermediate total, not necessarily the amount sold.
COGS is the inventory cost assigned to goods sold during the selected period.
Compare COGS with revenue only when both figures cover the same period and reporting basis.
Review unexpected changes in ending inventory because they can materially affect the result.
Assumptions & Important Notes
- Each example uses the periodic inventory formula.
- All amounts are in US dollars solely for illustration.
- The inventory balances and purchase activity cover the same reporting period.
- Freight-in is treated as an inventory acquisition cost in these examples.
Related Examples
Frequently Asked Questions
How do I calculate COGS for a month?
Use beginning inventory for the month, add net purchases during the month, and subtract ending inventory from the same month-end date.
What happens if purchase returns increase?
Higher purchase returns or discounts reduce net purchases and generally reduce COGS, assuming the other inputs do not change.
Why can purchases be higher than COGS?
Some purchases may remain in ending inventory rather than being assigned to products sold in the current period.
Can this calculator be used for quarterly or annual COGS?
Yes. Use inventory and purchase amounts that all relate to the same selected quarterly or annual period.
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Use the live calculator with your own inputs, timing, and preferences.